Bob English Shines the Light of Inflation upon the Shadow Banking System!

Welcome to Capital Account. Many have looked to Mario Draghi's leaked comments for hints about the upcoming European Central Bank' policy. His comments suggested the ECB could directly buy government bonds maturing in three years or less. Meanwhile, Moody's changed its EU outlook to negative on concerns about the core AAA countries that fund the EU. So with Europe back in the spotlight and its leaders are back from vacation, the team at Capital Account thought it would be a good time to start our engines after a two-week hiatus! Also, Ben Bernanke's Jackson Hole speech brought up a debate between economists about whether the US's unemployment problems are structural or cyclical. Some of those who believe unemployment is cyclical argue inflation is low and the Federal Reserve should do more to help the jobs situation. We look at this assumption about inflation with Bob English, guest contributing editor at ZeroHedge. He takes a special stroll onto Washington's streets to ask ordinary people what, if anything, they know about shadow banking and the role it plays in the inflation vs. deflation debate! And lastly, as the Democratic National Convention gets underway, following the close Republican National Convention last week, the political establishment in Washington vies for support. At a time when distrust in political institutions has been eroded by malfeasance, corruption, and dysfunction, it seems students at Harvard are preparing for their entry to the ruling class by cheating in their intro to congress class. Lauren and Demetri will give you their take on today's "Loose Change."