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The deflation trade is still on. Here is the trend of inflation excluding food and energy (as if they matter) with the September figures

Load up on those government bonds boys and girls.

Including food and energy (I eat and drive a car) and a more realistic basket of good and services and you have negative real yields across the entire US Treasury term structure.

The problem at the moment is that there are no assets that I can think of that are fairly priced. QE has made everything too expensive from houses to bonds to shares to cash.

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Including food and energy (I eat and drive a car) and a more realistic basket of good and services and you have negative real yields across the entire US Treasury term structure.

The problem at the moment is that there are no assets that I can think of that are fairly priced. QE has made everything too expensive from houses to bonds to shares to cash.

You can still get a yield of well over 3% if you buy ex-US developed market stocks. I have a decent amount of my money in EFV traded in New York. Other than the lows of 2008/9 these stocks are trading as cheap as they have done in 20 years.

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Here is the trend of inflation excluding food and energy

I keep trying to give up eating, using anything electrical and going out but I clearly lack the will power.

Aren't there any patches for this kind of thing?

man_nicotine_patches.jpg

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Yep.

Agreed.

I still don't understand why Mises isn't more mainstream, when all the prominent, proper Mises followers (Miserabilists?) predicted the Crunch several years before the crisis, and they nailed the overall trends since.

I am a total novice, but I still find Peter Schiff's 2006 speech to the mortgage bankers of America almost spooky in its prescience.

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Deflation of high order goods, inflation of low order goods - food and energy like they matter!

So as long as I don't heat, eat or move then life is deflationary - cool.

Mises looks to be bang on the money at the mo.

Exactly. My girlfriend works for a travel company, the whole industry is fighting for it's life right now. They are missing minimum booking targets by a third, even though they are discounting like mad (here is the supposed deflation).

It won't end well for the weakest companies. Once the 'deflation' (read slashing prices below profit margins in a last bid effort to stay afloat) has shaken the weakest from the pack, the remaining ones will be able to consolidate their positions and inflation will take hold here too. Either that, or there won't be any holiday companies, because you can't keep cutting indefinitely and making a loss.

Although I guess it could be that all the holiday companies, airlines, resorts and hotels are all so badly leveraged with debt that they'll all collapse. The ultimate deflation, no holidays on offer, so zero cost, deflation to infinity ;)

Edited by General Congreve
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Agreed.

I still don't understand why Mises isn't more mainstream, when all the prominent, proper Mises followers (Miserabilists?) predicted the Crunch several years before the crisis, and they nailed the overall trends since.

I am a total novice, but I still find Peter Schiff's 2006 speech to the mortgage bankers of America almost spooky in its prescience.

Devils advocate as when it comes to economics the Austrians seem to be the closest to reality all the time.

Peter Schiff is a bit of a permabear. He hasn't actually made much money out of his prognostications supposedly. Timing is everything and he called it way too early.

Also even Krugman predicted the current crisis, so it's successful prediction is not something unique to Austrians.

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Devils advocate as when it comes to economics the Austrians seem to be the closest to reality all the time.

Peter Schiff is a bit of a permabear. He hasn't actually made much money out of his prognostications supposedly. Timing is everything and he called it way too early.

Also even Krugman predicted the current crisis, so it's successful prediction is not something unique to Austrians.

Timing is everything in trading, yes. When you are a policy maker running the economy, though, it should be a case of looking at where the trends are headed and identifying what is healthy, sustainable and ethically sound, rather than working out when to make a killing. The Austrian school way of thinking (as far as I know) was right to sound the alarm on debt based speculation and the formation of bubbles.

Whatever colour of economics the BoE/Brown were following, they (charitably) didn't spot the same trend.

Trading is as much about luck as anything else. Investing is diff'rent. That's the mantra that I've stuck to f'r a while, although I'm not convinced I can every identify the difference in reality, and Schiff falls between the investor and speculator stools.

Edited by WageslaveX14
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Including food and energy (I eat and drive a car) and a more realistic basket of good and services and you have negative real yields across the entire US Treasury term structure.

The problem at the moment is that there are no assets that I can think of that are fairly priced. QE has made everything too expensive from houses to bonds to shares to cash.

Yup. only Ben and Mervyn can eat and drive electronic credits...

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Devils advocate as when it comes to economics the Austrians seem to be the closest to reality all the time.

Peter Schiff is a bit of a permabear. He hasn't actually made much money out of his prognostications supposedly. Timing is everything and he called it way too early.

Also even Krugman predicted the current crisis, so it's successful prediction is not something unique to Austrians.

Are you being ironic?

1. Schiff was recommending gold at $500. Imagine if you had followed his advice, you'd be rich now

2. Krugman only predicted the crisis after it had happened. Krugman was one of the many people laughing a Faber, Schiff, Rubbini

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Deflation of high order goods, inflation of low order goods - food and energy like they matter!

So as long as I don't heat, eat or move then life is deflationary - cool.

Mises looks to be bang on the money at the mo.

I can foresee the day when a loaf of bread will cost more then a bread-making machine.

:(

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Devils advocate as when it comes to economics the Austrians seem to be the closest to reality all the time.

Peter Schiff is a bit of a permabear. He hasn't actually made much money out of his prognostications supposedly. Timing is everything and he called it way too early.

Also even Krugman predicted the current crisis, so it's successful prediction is not something unique to Austrians.

Any links to when Krugman predicted this crisis?

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  • 428 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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