I was this morning on CNBC's Squawk Box being interviewed on my recent argument that the US is at risk of stagdeflation, i.e. a recession with a sharp fall in inflationary pressures, if not outright deflation: a fall in US and global aggregate demand, a slack in labor markets and a sharp fall in commodity prices following the US recession and the global slowdown will sharply reduce inflationary forces ahead, both in the US and across the world. Inflation will soon become the last of the problems of central banks as a severe global growth slowdown gets underway.

See also a recent Bloomberg column by William Pesek elaborating on my stagdeflation arguments.

In the meanwhile the current US recession - as the US is indeed already in a recession - is becoming deeper and more severe. Let me elaborate on this issue...