Impredicative type-class context causes stack overflow or non-termination in type checker

This program makes GHC loop. The first time the stack overflows; the second time GHCi just hangs.

$ cat Bug.hs
{-# OPTIONS -fglasgow-exts #-}

module Bug where

data T t where
    T :: (forall a. T (f a)) -> T (forall a. f a)

instance Show (T t) where
    show (T t) = show t

$ ghci Bug.hs
   ___         ___ _
  / _ \ /\  /\/ __(_)
 / /_\// /_/ / /  | |      GHC Interactive, version 6.6, for Haskell 98.
/ /_\\/ __  / /___| |      http://www.haskell.org/ghc/
\____/\/ /_/\____/|_|      Type :? for help.

Loading package base ... linking ... done.
[1 of 1] Compiling Bug              ( Bug.hs, interpreted )
*** Exception: stack overflow
> :reload
[1 of 1] Compiling Bug              ( Bug.hs, interpreted )
Interrupted.
>

Trac metadata

Trac field	Value
Version	6.6
Type	Bug
TypeOfFailure	OtherFailure
Priority	normal
Resolution	Unresolved
Component	Compiler
Test case
Differential revisions
BlockedBy
Related
Blocking
CC
Operating system	Unknown
Architecture	Unknown