In Mish Shedlock's latest update (see here) he attempts to reconcile his deflationary bias towards global asset markets with Marc Faber's focus on inflation. He highlights the possibility of a sovereign debt default of one of the PIIGS (Portugal, Italy, Ireland, Greece & Spain) along with other troubled areas such as Mexico along with the housing bubbles in Australia & Canada in particular. Mish's blog goes into more detail than I do here.
The interview on Yahoo's Tech Ticker with Marc Faber can be found here.
Essentially it becomes a meaningless argument as both inflation & deflation in my opinion will happen but at different times in different places. What is important however is how to profit from it.
I am bullish on the US Dollar purely from the perspective that I am an Australian Dollar based investor. It is all relative. A rising US Dollar will merely be the result of a collapse of the Euro and/or the Yen first (which will bring the Aussie Dollar down with it as it has rallied strongly on the back of a recovery in equity & commodity markets), NOT the result in my opinion of an improving US economy. That is an important point.
I am not looking forward to seeing how this plays out.