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Why We Will Get Stagflation


Saberu
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I believe there will be stagflation, but this was a surprise to me!

http://news.bbc.co.uk/1/hi/scotland/taysid...ral/7256745.stm

Council tax cut gets green light Stirling Council has agreed to cut its council tax bills for the coming year. The local authority unanimously approved a 1.1% reduction

If only I lived in Stirling.

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GF, what will happen to the price of the shiny yellow stuff if we get stagflation?

Not got any yet, but thinking about it.

TKS,

trekking.

First of all I suggest you do a little more research before you buy, although I agree with Goldfinger on gold going up I think anyone who wants to invest in something should do their own research first or it's no better than what caused our housing bubble in the first place :lol:

Wow four pages and 5 stars, wasn't expecting that perhaps it was the Goldfinger official approval effect :P

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hi d&c,

yes, iirc Narco used that one on here first & I googled it to see when it had first been used (2002 iirc)

ps - I have been missing the daily chat, bl00dy work eh..... <_< I am down to about 2 hours browsing a day now ;) , but can't post....

Hi GOM,

I've been trying to cut down on the economic chitter chat. It's been experiencing stagflation of it's own - an increase in volume but a stagnation of new content. :lol: In the abscence of any real new information or debate, it's getting partisan instead of a nice intelligent discussion, IMHO (and I've probably contributed :( )

I've started to think about writing a piece on Nagflation, and it's relationship to Shagflation and the Central (W)bank rates :)

For what it's worth, while oil keeps rising then all commodities will rise. We don't have a free market in oil, so the usual rules do not apply. Oil is totally politically controlled, but all producers have a VI in high prices. At the same time, we have a big restriction in credit, and if this is sufficient to halt the money supply growth to below inflation, which in my book is a certainty, then we will have massive asset price crashes as we all become poorer.

It's not all bad news though. The world needs to slow down. I'd quite look forward to the 3 day week :lol:

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Well if I dont decorate the lounge over easter it will be Naglation followed by deShagflation :)

Basic supply and demand at play...

Nagflation and Shagflation are almost enitely inversely correlated. I believe it's possible for them to stray from this rule in the very short term. The only known driver for this circumstance is sex for reproductive purposes, otherwise known as the "Baby Bubble". This ultimately always ends in massive bust, with triple digit nagflation and even bigger deshagflation. Then the central (w)bank rate goes through the roof.

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Basic supply and demand at play...

Nagflation and Shagflation are almost enitely inversely correlated. I believe it's possible for them to stray from this rule in the very short term. The only known driver for this circumstance is sex for reproductive purposes, otherwise known as the "Baby Bubble". This ultimately always ends in massive bust, with triple digit nagflation and even bigger deshagflation. Then the central (w)bank rate goes through the roof.

Genius!

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GF, what will happen to the price of the shiny yellow stuff if we get stagflation?

Not got any yet, but thinking about it.

TKS,

trekking.

In a 1970s style stagflation, I would expect gold to reach $3,000-$5,000 over the next 5-7 years.

However, these numbers are not adjusted for future inflation, but reflect purchasing power in todays money. So, nominally, gold could go much higher.

Edited by Goldfinger
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