That’s what Doug Kass calls our current economic environment and he’s been warning about it for about a year. When Doug used to warn of the dangers of subprime lending, bulls said he didn’t know what he was talking about. They’re doing it again with “Blahflation” (per Kass) or “Stagflation Lite” (per Roubini). But no matter what you call it (I say “Confuflation”), this economy is heavily conflicted by slow growth and growing inflation. Today’s economic data contributed greatly to the Stagflation case and yet, the permabulls are in control so there’s a better chance that it will be denied or attacked rather than seriously considered. I got a kick of the usual suspects on CNBC immediately saying that this is just one data point and we need a lot more proof before we should worry about Stagflation. Excuse me but there has been an abundance of similar data for months. When you are constantly turning away from reality you cannot see it. When you are to busy patting yourself on the back, you cannot reach for it. When you are loudly signing your praises, you cannot hear it. In the end, Stagflation is becoming a much more credible theory but it will not matter to stock prices until investors pay attention.