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Central Bankers Stoking The Inflation Fires, Whilst Academic Economists Worry About Deflation

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Deflationists remain just as delusional today as when I wrote in November 2009. Instead of realising that they are wrong and do something to save themselves and their readers from going broke by holding cash and invested in bubbles destined to burst such as government bonds under the weight of ever escalating money printing or quantitative easing, 1, 2, 3, 4, quadrillion, they instead ignore CPI inflation (unless its falling) and come out with nonsense such as pricing assets in terms of the gold price to imply deflation is taking place when peoples food baskets i.e. the REAL WORLD show INFLATION is accelerating away from them , or in some cases implying that inflation is really deflation in disguise because of loss of purchasing power, which is the whole point of what inflation IS ! Where prices rise to erode the purchasing power of your savings and earnings! I hear weak economies mean deflation looms, well try telling that to Zimbabweans!

LISTEN , protect your wealth from the inflation mega-trend by hedging in scarce resources such as Gold, Silver, Agricultural and other Foods, metals, energy, stocks of dividend cash cows, emerging markets and more as elaborated at length in the Inflation Mega-trend ebook, now 7 months on we are further along the inflation mega-trend with no signs of reversal into the phony debt deleveraging deflation mantra that we have been hearing about for several years now that has FAILED to materialise, 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! But by which time your savings will have been wiped out by following the perma deflationists mantra of "cash is king". Yes I am being blunt because sometimes you have to be to knock some sense into people!

http://www.marketoracle.co.uk/Article21899.html

Take your pick, are you in the deflation camp or inflation camp? Im of the inflation view but house prices are so high relative to earnings, we will see house price falls until the wage price spiral kicks in.

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Take your pick, are you in the deflation camp or inflation camp? Im of the inflation view but house prices are so high relative to earnings, we will see house price falls until the wage price spiral kicks in.

inflation in stuff we need

deflation in stuff bought with borrowed money( for a while anyway)

and Merv only worries about wage inflation - all part of the plan to make the masses have less money

Edited by lowrentyieldmakessense(honest!)

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Deflationists remain just as delusional today as when I wrote in November 2009. Instead of realising that they are wrong and do something to save themselves and their readers from going broke by holding cash and invested in bubbles destined to burst such as government bonds under the weight of ever escalating money printing or quantitative easing, 1, 2, 3, 4, quadrillion, they instead ignore CPI inflation (unless its falling) and come out with nonsense such as pricing assets in terms of the gold price to imply deflation is taking place when peoples food baskets i.e. the REAL WORLD show INFLATION is accelerating away from them , or in some cases implying that inflation is really deflation in disguise because of loss of purchasing power, which is the whole point of what inflation IS ! Where prices rise to erode the purchasing power of your savings and earnings! I hear weak economies mean deflation looms, well try telling that to Zimbabweans!

LISTEN , protect your wealth from the inflation mega-trend by hedging in scarce resources such as Gold, Silver, Agricultural and other Foods, metals, energy, stocks of dividend cash cows, emerging markets and more as elaborated at length in the Inflation Mega-trend ebook, now 7 months on we are further along the inflation mega-trend with no signs of reversal into the phony debt deleveraging deflation mantra that we have been hearing about for several years now that has FAILED to materialise, 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! But by which time your savings will have been wiped out by following the perma deflationists mantra of "cash is king". Yes I am being blunt because sometimes you have to be to knock some sense into people!

http://www.marketoracle.co.uk/Article21899.html

Take your pick, are you in the deflation camp or inflation camp? Im of the inflation view but house prices are so high relative to earnings, we will see house price falls until the wage price spiral kicks in.

best yet from marketoracle

thanks for sharing.

it was going to be inflation will be leading to dare I say

hyperinflation

cgnao did warn of this.

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There is NO cost/price deflation agreed..........

There is CREDIT deflation, borrow to buy, reduced credit facility, reduced demand, fall in credit prices etc etc..........

There is cost inflation in things we have to have, we need, so wages/savings earnings power of these two cash powers will go down relative to the cost of things we buy with cash tools such as savings/wages.................

So where are we, as above.........For me as soon as a wage upwards spiral kicks in, so will an interest rate upward spiral kick in. Interest rates will stay ahead of wage agreements, they always have they always will. So cash will earn more, as interest rate rise in line with and above wage settlements.

So no cash will not diminish into thin air, you do not have to buy as much gold, silver, baked beans as possible.

Its about human resource, it has always been about human resource, you earn cash to buy things you need to survive, the balance between reducing purchasing power of cash............savings to the things you buy with the is widening, so we have inflation in costs relative to cash until someone grows a pair of balls and asks for more money to buy these things.

We borrow money to buy cars, houses, and all the other stuff which costs silly money, this is credit deflation, we are seeing and will keep seeing until wages catch up, so modest wage rises, modest falls in asset values....................

If you are living off your savings, it will last a shorter period of time as the years go buy, similar to your wage every week. Eventually when you get a rise, then the rise will be offset against a rise in interest rates if you are in debt. Its why the poor stay poor and the rich get richer.............

P

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the deflation mantra will continue right up to the point where the wage price spiral kicks in

Wages in the west have declined for two decades for a reason- no leverage. So now, as unemployment rises, suddenly the workforce are going to grow some muscle? How is that going to work exactly?

The fact that the inflation model requires wage inflation does not therefore mean this will arrive on cue does it? What's left of the unions might be able to apply some pressure- but for most people there are no unions and no way to pressure for a pay rise.

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Hyperinflation needs no wage inflation at all.

The only thing that needs to happen, is for people with savings to lose confidence and to start bailing out of Sterling. It's as simple as that.

http://www.cobdencentre.org/2010/08/john-hathaway-the-end-game-for-paper-currency/

The central banks want velocity of money to pick up, with people consuming and investing. What they don't want is velocity of money picking up, with this money ending up in commodities because 1. they don't want to consume (worried about job, future etc) and/or 2. there is nothing to invest in (businesses struggling, companies down sizing etc).

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here's the graph you're looking for:

m2m3_cpi_money_supply_and_inflation.png

price inflation follows monetary inflation. Talk of wage price spirals, spare capacity and other such nonsense is simply misdirection from those that don't want you to know. Wake up.

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Hyperinflation needs no wage inflation at all.

The only thing that needs to happen, is for people with savings to lose confidence and to start bailing out of Sterling. It's as simple as that.

http://www.cobdencentre.org/2010/08/john-hathaway-the-end-game-for-paper-currency/

The central banks want velocity of money to pick up, with people consuming and investing. What they don't want is velocity of money picking up, with this money ending up in commodities because 1. they don't want to consume (worried about job, future etc) and/or 2. there is nothing to invest in (businesses struggling, companies down sizing etc).

yep

make sense

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here's the graph you're looking for:

m2m3_cpi_money_supply_and_inflation.png

price inflation follows monetary inflation. Talk of wage price spirals, spare capacity and other such nonsense is simply misdirection from those that don't want you to know. Wake up.

That graph reinforces my convictions. Oh another thing to buy in/before high inflation is property... Edited by AteMoose

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Hyperinflation needs no wage inflation at all.

The only thing that needs to happen, is for people with savings to lose confidence and to start bailing out of Sterling. It's as simple as that.

http://www.cobdencentre.org/2010/08/john-hathaway-the-end-game-for-paper-currency/

The central banks want velocity of money to pick up, with people consuming and investing. What they don't want is velocity of money picking up, with this money ending up in commodities because 1. they don't want to consume (worried about job, future etc) and/or 2. there is nothing to invest in (businesses struggling, companies down sizing etc).

yep

hyperinflation - paper money implodes as enough people see the con game for what it is

it is not caused due to an increase in economic activity

and yet most of those arguing against hyperinflation state that we cant have it due to the excess capacity

they should check out hyperinflations that have happened previously

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That graph reinforces my convictions.  Oh another thing to buy in/before high inflation is property...

I wouldn't be so sure, unless you have bought property without credit.

Therefore, for those who purchase property on credit in the belief that it can serve as a hyperinflationary hedge, this can be a decision of regret as they get crushed by the debt servicing burden. The only way out is to sell the property. But if the liquidity of property dries up during a crack up boom, then this only escape route is being cut off.

(http://cij.inspiriting.com/?p=475# - lots of other sources too)

If you are not fixed during the period, the interest rates would be ruinous. Wages would lag, but banks would be first to protect their interests. The price of all essentials goes through the roof and people need to stay liquid.

As for BTLs... they'll get wiped out, as people will refuse or be unable to pay at the rent rises requested. Not a problem if you own the properties outright, but not good if the bank keeps putting the mortgage rates up and you can't bridge the gap. Cascading defaults and repossessions would mean cheaper rents and abandoned properties (with squatters) would likely be common.

Hyperinflation would be ruinous to everyone, but the last thing you would want, is to be a bankers' bitch during the process.

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  • 149 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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