Sunday, Aug 15, 2010
More from Nadeem
Market oracle: Central Bankers Stoking the Inflation Fires, Whilst Academic Economists Worry about Deflation
'[There] IS NO DEFLATION, the deflation mantra will continue right up to the point where the wage price spiral kicks in as it slowly dawns on the academic economists / perma crowd that their theories are just as bankrupt as most of the western economies actually are'
Posted by hpwatcher @ 09:50 AM (1068 views) Add Comment
10 Comments
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1. hpwatcher said...
Apologies for the rather crude question - but I was just wondering what the majority of posters on HPC saw as the greater threat, and what they were planning for. Obviously I am in the inflation camp, but I'd be very interested to hear what others think and have experienced - please feel free to give any examples.
2. enuii said...
I know Nadeem likes his long sentences but paragraphs 4 and six take the biscuit and give the impression that he is getting rather manic at the moment. My gut feeling is we are about to enter an autumn similar to 2007's and Mr Walayat's writings are reflecting a certain unease as to where events will take us. Time will tell but the whole thing is happening in slowwwww motion at the moment and thinking back the last 3 years have been financially speaking very long ones for the spectators on the sidelines of the show.
3. powerofnow said...
I'm expecting ongoing manipulation of the masses by the aristocratic elite. The best way to maintain control of resources is to control all everything which needs the resources.... So I expect manipulation of the money supply, restriction of access to land, and lots of propaganda to keep us confused.
So I'm planning to be happy come what may
4. wdbeast said...
I am confused about the inflation/deflation arguement and could do with some help understanding it.
Over the last 10 years we have seen massive inflation in house prices but enormous deflation in most comsumer goods from computers to clothes etc.
We are now entering a period where most on this site believe we will have deflation in house prices by say 30% over the next few years and probably a period where consumer goods, energy and food will raise relatively within the same period.
My question is simple, have we been in deflation for the last decade by the same measure that some are forecasting inflation.
5. icarus said...
Depends when you take your food price reading. A few months ago food prices were at their lowest level in three years. And where's the inflation on big-ticket items that few people are buying? Current trend is inflation on essential items, deflation on non-essentials. This subject needs more analysis than this article offers. Stock prices can rise temprarily because (a) QE stuffs the banks with money to inflate stock prices (b) thin trading (c) layoffs and cost-cutting temporarily boost profits, etc. Similar factors can work on inflation in other items. Certainly total consumer expenditure is down, so higher food costs can mean (a) we substitute - buy more lower-price food, less higher-price food without affecting the price of the higher-price food in the short run or (b) we spend more on food and, less on other things.
6. powerofnow said...
secretofOZ is a must watch history of money creation and central banks.....: http://www.youtube.com/watch?v=D22TlYA8F2E
7. estrader said...
Planning for Inflation. Couldn't care less about deflation.
8. Major Des Aster. said...
"Planning for Inflation. Couldn't care less about deflation. "
I am with you estrader.
9. techieman said...
"Apologies for the rather crude question - but I was just wondering what the majority of posters on HPC saw as the greater threat" - neither is a threat - both are opportunities if you look in the right place.
To plan for inflation requires buying things that protect you from it and perhaps gearing up to do it. For deflation requires selling things and gearing up for that too. Or deflation requires staying in cash. As icarus says its a bit difficult when some things are inflating and some things are deflating.
At that time it depends on your personal position, and your personal inflation/ deflation reading dunnit. As i said the other day if i have a budget of £1m for a house and HPs fall 10%, but the price of apples goes up 10% then im gonna have to eat a hundred tons of apples to be worse off (m aybe more i havent done the math). Clealy for someone else their calculation is different, and possibly skewed.
So i am better off keeping money in the bank even if it just stays where it is - because my £ will by more house - and the house is what interests me. For someone else that perceives inflation as being a threat perhaps they should get some gold or even a few thousand tins of value beans.
10. debtfree said...
I'm in the 'loss of confidence in a currency' camp.