US Entering Very Tough Period of Stagflation. Former Federal Reserve Chair Alan Greenspan warns that America is entering a very tough period of stagflation as it emerges from economic stagnation. As the inflationary pressures which now seem to be building, weve just been through a long period of stagnation, were moving now toward what we used to call stagflation, he told Fox Business Network. Stagflationis commonly defined as persistent high inflation combined with high unemployment and stagnant demand in a countrys economy. Greenspan explained that the economic transition only appears positive in the short term. The short term outlook begins to look sort of slightly buoyant, because the inflation actually moves profitability, and you get a sense that maybe things are over. But thats going to be a false dawn. Greenspan compared todays economy to the 1. Weve been through this period before of stagflation, back in the 1. Greenspan pointed to concerns over the impact on long term debt. There are pressures obviously emerging for long term debt to start moving up. Its at an extraordinarily low level. To be sure, Federal Reserve policymakers were increasingly split on the outlook for inflation and how it might affect the future pace of interest rate rises, according to the minutes of the Feds last policy meeting on June 1. Wednesday. The details of the meeting, at which the U. S. central bank voted to raise interest rates, also showed that several officials wanted to announce a start to the process of reducing the Feds large portfolio of Treasury bonds and mortgage backed securities by the end of August but others wanted to wait until later in the year, Reuters reported. Most participants viewed the recent softness in these price data as largely reflecting idiosyncratic factors. Fed said in the minutes. The committee questioned why financial conditions had not tightened despite recent rate rises and a few said equity prices were elevated. U. S. stock prices edged lower after the minutes were released and yields on U. Wii Internet And Homebrew Browser Flash there. S. government debt rose slightly while the dollar firmed against a basket of currencies. Newsmax Finance. All rights reserved. Heres a delicious and almost foolproof recipe for novice bakers thats easily customized with spices, a little rum or dried cranberries. See Dorie Greenspans bonnes. On Thursdays, Dorie Greenspan drops by with a delicious baking recipe for you to try. Preheat those ovens, people Ed. As every baker knows, Thanksgiving is really.