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I have a great deal of respect for this track record. Stanley has great vision and is certainly a very smart man but as smart as he sounds I cannot help but wonder how it is he does not see the fatal flaw in his logic.
Sovereign debt levels have gone parabolic globally. Look at what happened to the periphery in Europe when borrowing costs reflected normalcy? Kyle Bass has stated that a 100 to 150 basis point move in borrowing costs for Japan makes it mathematically impossible to service the debt.
So, what you have here in these sovereign entities is the end game for debt that cannot be extinguised by gold. ZIRP is the new normal. Sure rates can oscillate everywhere but Japan within a low range but you get above a certain level and it is all over. This is where I believe Armstrong has it wrong. Corporations are no place to hide in a Western sovereign default. Corporations require the government teet. Corporations hold government debt. Corporations rely on government employees to buy their products. Look at the disclaimer from Wal Mart if food stamps are cut.
With all due respect Stanley, the FED and every government is praying for double digit inflation.