Where I believe Prechter is incorrect is in his view that deflation is the dominant force. Ironically, it is the multi-decade downward slope in long term treasury yields that allows the inflators in high places to do their work. As long as bond yields give them permission, they will be political animals, playing to the crowd and consolidating power.
Also Ironically, I believe it is when/if this changes, our secular "line in the sand" on the long bond is violated, and hyperinflation fears start to break out, then a real deflation will be possible. It would be a deflationary crash into the end of the system. But it would be born of decades of 'successful' inflationary policy.
Anyway, preamble aside (as I always seem to do when presenting something by Prechter), here is an excerpt from the Elliott Wave Theorist on the herd's love of the Muni bond market: Individual Investors Have Jumped Into Another Fire.
