Oh dear.The Fed lowers growth forecasts,predicts increased unemployment,and oil also jumps to 101$ on supply concerns.It's the 70s all over again,and this time not just disco.Stagflation writ large.What should the Fed do? Here's the problem.It doesn't know and even if it did it's too late.

Question:who really controls the US economy now? Answer the US consumer,unfortunately he's broke at the moment.Who then if not the US consumer? It's the Sovereign Investment Funds of the Middle East silly.They've bought into the financial infrastructure of the US via Wall Street.Now OPEC will start cutting oil output.They are also probably behind the hedge funds which are taking positions in the oil market now.As the price of crude goes up,this will inject enormous inflation into the US economy and become a huge drag on growth.If you thought a recession risk was 50:50,it's probably wise to reconsider.

In a serious downturn who do you think will be buying up America's prized assets on the cheap?You guessed it.Sovereign Investment Funds.The real change after this recession will be the fact generations of American workers yet to be born will be in effective bondage to the wealth funds of the developing world.

The US in it's hunger to consume now has mortgaged away it's future.It's just another overleveraged bet that went wrong.Dump US stocks.