Jump to content


Photo

The trigger for a Hyperinflationary shock


94 replies to this topic

#1 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 01:47 AM

The trigger for a Hyperinflationary shock
Podcast with Gonzalo Lira
Link to here: http://tinyurl.com/GEI-LiraHyp
===============================

In this conversation between Michael Hampton and Gonzalo Lira in Santiago, Chile, the two discuss the shock event which could trigger a sudden move into hyperinflation within the US. Mr. Lira argues that there is already enough money in the system to trigger a "Shazaam moment." And Mr. Hampton argues that there is a third alternative to default and hyperinflation, and that's Haircuts and sharing the pain, the pathway that the UK has started down. The discussion gets lively as the two put forth opposing points of view, and they agree that hypenflation, if it comes, may play out differently than many expect. For instance, will property be a good investment in a hyperinflation scenario?

The trigger for a Hyperinflationary shock:
http://globaledge.po...ationary-shock/



Charts


TLT / T-Bond etf ... update


DXY / US Dollar ... update


TNX / Bond Yields ... update : TNX vs. DXY


SPY / S&P500 etf ... update


GLD / Gold etf ... update


Compare - Where did the money go? - See Below

= = = = =
LINKS:
Gonzalo Lira's Blog :: http://gonzalolira.blogspot.com/
Prior GER Podcast.. :: http://tinyurl.com/GER-hyper10
HPC Clone thread.. :: http://www.housepric...howtopic=150911
" Chris Martenson.. :: http://www.chrismart...continues/44345
Thread on S's NNW. :: http://neuralnetwrit...2.com/node/3468
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#2 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 01:51 AM

THE STORY ...
Was not one of money fleeing Bonds and fleeing the Dollar - since the USD actually rose while bonds went down.
Nor was it one of money fleeing bonds for commodities in general -only precious metals surged.





Recent: TBonds/Stocks/US$ : Silver/Grains/Oil

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#3 aliveandkicking

aliveandkicking

    Millennium man

  • Members
  • PipPipPipPip
  • 2,586 posts
  • Location:Helsinki Finland

Posted 11 September 2010 - 06:58 AM

The guy is just mixed up.

Why are the rich going to flee the USA to some place of great opportunity when they have it sweet in the USA at a time when there is widespread economic chaos around the world and the USA is the worlds number one super power and largest economy on earth?

The situation in Chile was where a nutter was destroying the economy for the benefit of his worker cronies where the private owners were being destroyed.

The idea the USA is about to suddenly go down the gurgler is a bit nuts or just wishful thinking.







#4 double-agent

double-agent

    Millennium man

  • Members
  • PipPipPipPip
  • 1,197 posts

Posted 11 September 2010 - 07:42 AM

i had trouble downloading the mp3 (firefox) so i went to the mobile site and right hand button mouse clicked the link and selected 'save link as'

http://globaledge.po...ationary-shock/

just in case anyone else is having the same trouble............

#5 azazel

azazel

    Millennium man

  • Members
  • PipPipPipPip
  • 1,812 posts
  • Gender:Male
  • Location:England

Posted 11 September 2010 - 08:00 AM

Great interview, well done DrBubb. His argument sounds credible to me. Even if there is no hyperinflation, I'm confident that the run in commodities has a long way left to run. The rate of decline in the purchasing power of money is increasing in a parabolic fassion, which indicates that high inflation, which could then turn hyperinflation will be the outcome.

#6 romans holiday

romans holiday

    Tri-Millennium Guru

  • Members
  • PipPipPipPipPip
  • 8,675 posts
  • Gender:Male
  • Location:The Southern Alps

Posted 11 September 2010 - 09:56 AM

Was a little disappointed to hear Gonzalo insist, about half way through, that it IS hyper-inflation, rather than give more of a reasoned approach on how it might be hyper-inflation.

G outright states that 10% odd inflation in CPI would be hyper-inflation, the early stage.... even as asset prices declined. Of course there are alternative theories out there that can give an explanation for this. Taking an international approach; nationally, local assets can depreciate against the local currency, AND globally, the local currency itself can depreciate against other currencies.. this would lead to price distortions and upwards pressure on such things as imported commodities and consumables.... ergo up to 10& inflation in CPI, but how can hyper-inflation be deduced from this?

There was no real comparison and parallels drawn between what happened in Chile and what is happening in UK/ US etc.

Run on the US bond market? So the panic out of treasuries involves all the banks and fat cats running to buy up all the baked beans etc in town? laugh.gif The elephant in the room is Japan, and any comparison with its bond market always seems to get ignored by hyper-inflationists.

The idea of haircuts is worth further exploring [G doesn't seem to want to see that a populist political movement in the US is leading to austerity not continued stimulus.... with a massive influence on both main parties, especially the Republicans]. Haircuts at the national level. And at the international level. imo this haircut will involve a structural change in currency/ trade, which could require the dollar being linked to gold, in order for surplus currencies to appreciate. this would lead to say a 30% haircut on the real value of their foreign reserves.... but also rebalance trade which is very much in everyone's interest.

It was interesting that G thought that further stimulus/ printing was not required, and the existing stock of money was sufficient to cause hyper-inflation. I find this a bit incredible though given that we are in a debt deflation, which is looking to gooble up as much money as it can.
Modern money "shorts" the currency, and is backed by debt. The debt is real. A debt deflation will lead to a prolonged period of deleveraging, where the short-covering of currencies will strengthen currencies relative to asset prices. At the global level, in the FX market, central currencies will benefit from deleveraging at the expense of peripheral currencies. Due to instability and uncertainty, gold will benefit against all currencies as it continues to be re-monetized.

Hold on to your hats for hyper-deflation, where cash is king, and gold the King of cash.
[Silver? A Volatile Queen].

#7 00timebandit00

00timebandit00

    Tri-Centurion

  • Members
  • PipPipPip
  • 439 posts
  • Location:Wellington, NZ

Posted 11 September 2010 - 10:20 AM

QUOTE (aliveandkicking @ Sep 11 2010, 06:58 PM) <{POST_SNAPBACK}>
The guy is just mixed up.

Why are the rich going to flee the USA to some place of great opportunity when they have it sweet in the USA at a time when there is widespread economic chaos around the world and the USA is the worlds number one super power and largest economy on earth?

The situation in Chile was where a nutter was destroying the economy for the benefit of his worker cronies where the private owners were being destroyed.

The idea the USA is about to suddenly go down the gurgler is a bit nuts or just wishful thinking.


Everyone is gonna want to be in New Zealand where we will experience a population explosion shortly. Just my prediction.

The USA may be the worlds number one super power but how can you maintain that with so much debt?

Great interview find Dr B. biggrin.gif

#8 Nigel Watson

Nigel Watson

    Centurion

  • Members
  • PipPip
  • 261 posts

Posted 11 September 2010 - 10:25 AM

Wishful thinking.

How can you have a podcast on hyperinflation and not mention velocity? Look on the internet; there's been plenty of examples of hyperinflation - all in economies running a fiat currency

The podcast completely ignored the velocity of circulation of the moeny supply. It's highly unstable by the way. You can't understand the cause (singular) of hyperinflation unless you get your head around this fact. Printing cash doesn't create hyperinflation straight away if cash is being hoarded (low velocity). But, as I say, velocity can quicly change. Velocity is NOT a constant.

#9 d2thdr

d2thdr

    .§.My Precious.§.

  • Members
  • PipPipPip
  • 813 posts
  • Gender:Male
  • Location:UK
  • Interests:Tennis, Cricket, Polo, Cooking.

Posted 11 September 2010 - 11:13 AM

QUOTE (romans holiday @ Sep 11 2010, 09:56 AM) <{POST_SNAPBACK}>
laugh.gif The elephant in the room is Japan, and any comparison with its bond market always seems to get ignored by hyper-inflationists.


Japan had a substantial savings. US/UK do not. How many times does this need to be repeated?

Good podacst Dr Bubb.
All I do is take these funny little rectangular pieces of paper or those electronic digits that appear on my computer screen that our zombie banks and governments call money and I turn them into silver and gold. The medieval alchemists never even go close to that miracle! I am turning paper into gold, it's awesome! We should be thanking the collective boneheads who make this magic possible.

FREEGOLD
V/S SLAVEGOLD


Gold coins then bank storage then gold lending then gold certificate use then lending of certificates then certificates are declared paper money then overprinted then gold backing removed then price inflation then,,,,,, we begin again. But this time it's different the hard money crowd say. Yes, it is. Only the time has changed-- FOA

The best thing about eating gold is pooping gold. Don't eat ETF GLD paper though, it's boring and painful to poop out.


#10 romans holiday

romans holiday

    Tri-Millennium Guru

  • Members
  • PipPipPipPipPip
  • 8,675 posts
  • Gender:Male
  • Location:The Southern Alps

Posted 11 September 2010 - 11:54 AM

QUOTE (d2thdr @ Sep 11 2010, 08:13 PM) <{POST_SNAPBACK}>
Japan had a substantial savings. US/UK do not. How many times does this need to be repeated?

Good podacst Dr Bubb.

Unfortunately, it's repeated ad nauseum like some mantra. I think it's a bit simplistic to dismiss comparisons to Japan just by saying things like "they had savings", and "they exported their inflation". Consider the amount of money moving from US equities to treasuries now....the facts are that individual investors and institutions are pouring into US treasuries. Also, it's not in the immediate interests of Asian countries to see the US bond market "blow up", and they will continue to support it... for now.

In Japan, we may have the future of developed economies concretely before us right under our noses. Surely, this is worth exploring. Why doess Japan not even register on the hyper-inflationist's radar? Because they are not looking at the real world for their clues, but inwards to abstract certainties. laugh.gif
Modern money "shorts" the currency, and is backed by debt. The debt is real. A debt deflation will lead to a prolonged period of deleveraging, where the short-covering of currencies will strengthen currencies relative to asset prices. At the global level, in the FX market, central currencies will benefit from deleveraging at the expense of peripheral currencies. Due to instability and uncertainty, gold will benefit against all currencies as it continues to be re-monetized.

Hold on to your hats for hyper-deflation, where cash is king, and gold the King of cash.
[Silver? A Volatile Queen].

#11 grumpy-old-man

grumpy-old-man

    Millennium man

  • Members
  • PipPipPipPip
  • 1,914 posts
  • Location:Devon

Posted 11 September 2010 - 12:21 PM

QUOTE (d2thdr @ Sep 11 2010, 12:13 PM) <{POST_SNAPBACK}>
Japan had a substantial savings. US/UK do not. How many times does this need to be repeated?


agreed


QUOTE (d2thdr @ Sep 11 2010, 12:13 PM) <{POST_SNAPBACK}>
Good podacst Dr Bubb.


agreed

#12 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 01:06 PM

Thanks for the feedback, everyone.
(I think Gonzalo will be pleased to hear some of those comments above, and I will suggest that he read this thread- and maybe even post a reaction here.)

I had to cut some bits. For example, we had a longer discussion about the issue of "how do they get the money into people's hands." I still don't understand why GL did not react to my repeated questions on this by simply answering:

+ It is likely Congress will do its bit in creating hyperinflation by sending out cheques when things get really tough, and people are struggling to buy food, energy, and other essentials - they won't want to stand aside and see people (voters!) starve,

+ One way that foreigners might recycle their dollars back to struggling Americans, would be to take their shrinking dollars and buy US stocks, and this will benefit Americans who have bought stocks at cheaper prices before they see the price rises. Personally, I think that this dumping of currency for stocks is common in hyperinflation scenarios, and the stock profits taken by Americans would help to fuel rapid inflation in the price of essentials.

Also, I am not disputing GL on property prices falling in Chile - afterall, he lived through that incident, and I did not. But it seems a bit unbelievable that Chile could experience some months of 20-30 PER MONTH inflation, and that Home prices would DROP in escudo terms. Part of this result may be explained by the fact that rising inflation pushes interest rates up, and property is generally pushed DOWN by rising rates, but it seems like sustained hyperinflation would eventually trigger some buying of property as a real asset that will still be around when the hyperinflation is over. Those with cash that is rapidly losing value may see "cheap" property as an alternative to perishable wasting assets like food. (The story about someone offering to swap a property for a dodgy car is amazing. And I wish now I had asked, WHY would someone make that swap?)
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#13 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 02:40 PM

Steve Netwriter has got a good thread on Hyperinflation on his website:
http://www.neuralnet...2.com/node/3427

Here's an excerpt, which I hope he will not mind that I have posted here:

Mish: We've still got a net contraction....for 5 quarters running, even counting government spending, we've had a net contraction in credit. That's deflation.

So, I guess he's talking money supply. That's deflation.

Mish: If $2 trillion didn't do it, why would $500 billion or whatever?

Mish: What is quantitative easing going to do in the face of $54 trillion worth of debt out there?

Mish: The Fed prints another trillion, it's just sitting as excess reserves.

I love the idea of "excess reserves"

Mish: Consumers are deleveraging, students with debt coming out of college with no way to pay it back, no jobs...

Mish: If all this debt could be paid back, for the next decade, we're facing structurally high unemployment....it's impossible to get inflation out of this mix.

He could well be right. A shrinking economy, with reducing debt.

But, this is the critical statement:

Mish: The hyperinflation case, if one wants to make one, and I'll make one right now, is congress sends everyone $60,000, that would probably do it, but is congress likely to do that?


Mish: All this talk about the Fed being able to drop money out of helicopters, that's not the way it works.

Mish: It's all backed by debt....

Mish: And not a bit of this could be construed as inflationary in any way I can think of.

The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#14 romans holiday

romans holiday

    Tri-Millennium Guru

  • Members
  • PipPipPipPipPip
  • 8,675 posts
  • Gender:Male
  • Location:The Southern Alps

Posted 11 September 2010 - 02:48 PM

QUOTE (DrBubb @ Sep 11 2010, 11:40 PM) <{POST_SNAPBACK}>
But, this is the critical statement:

Mish: The hyperinflation case, if one wants to make one, and I'll make one right now, is congress sends everyone $60,000, that would probably do it, but is congress likely to do that?

So is that it? Is that what the hyper-inflation case rests on? Are people so gullible to take this threat at face value, and see it as credible and not incredible? I've been calling this the Bernanke bluff for years. It's a bluff because they can not actually do it... there are legal and political constraints on what the Fed can do. Where does this idea of omnipotence come from. blink.gif

Some might say it's all a schoolboy fantasy, but I couldn't possibly comment on that. laugh.gif
Modern money "shorts" the currency, and is backed by debt. The debt is real. A debt deflation will lead to a prolonged period of deleveraging, where the short-covering of currencies will strengthen currencies relative to asset prices. At the global level, in the FX market, central currencies will benefit from deleveraging at the expense of peripheral currencies. Due to instability and uncertainty, gold will benefit against all currencies as it continues to be re-monetized.

Hold on to your hats for hyper-deflation, where cash is king, and gold the King of cash.
[Silver? A Volatile Queen].

#15 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 02:48 PM

QUOTE (Nigel Watson @ Sep 11 2010, 07:25 PM) <{POST_SNAPBACK}>
Wishful thinking.

How can you have a podcast on hyperinflation and not mention velocity? Look on the internet; there's been plenty of examples of hyperinflation - all in economies running a fiat currency

The podcast completely ignored the velocity of circulation of the moeny supply. It's highly unstable by the way. You can't understand the cause (singular) of hyperinflation unless you get your head around this fact. Printing cash doesn't create hyperinflation straight away if cash is being hoarded (low velocity). But, as I say, velocity can quicly change. Velocity is NOT a constant.

Velocity is a name for the speed of a process by which the money moves through the economy, or gets hung up in banks.

The critical thing is to understand that banks are taking very cheap money (costing maybe 0.25-0.30% from their depositors), and parking it in Treasuries, where a 10 year Note earns about 10 times their funding cost, before the profit or loss from capital gains on holding a longer term instrument. Clearly, this HUGE YIELD PICK-UP, gives banks a strong incentive to park their cheap money in Treasuries, rather than taking the "commercial gamble" of lending it out to corporate or individual borrowers.

Loads of bankers, and other institutions are now happy to take this "low velocity" gamble. I reckon it is better to understand the factor driving bank behavior, rather than simply referring to the Velocity of money, as if it were a purely abstract concept.
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#16 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 02:58 PM

QUOTE (romans holiday @ Sep 11 2010, 11:48 PM) <{POST_SNAPBACK}>
So is that it? Is that what the hyper-inflation case rests on? Are people so gullible to take this threat at face value, and see it as credible and not incredible? I've been calling this the Bernanke bluff for years. It's a bluff because they can not actually do it... there are legal and political constraints on what the Fed can do. Where does this idea of omnipotence come from. blink.gif

Some might say it's all a schoolboy fantasy, but I couldn't possibly comment on that. laugh.gif

As I mentioned in the podcast, I used to believe that there was no need to worry about hyperinflation UNTIL Congress passes some truly rah and reckless laws that distribute cheques directly to individuals. In other words, my idea was that the Congress is operating the hyperinflationary helicopter, not Ben Bernanke, or the Fed.

But Mr. Lira's articles forced my to reconsider that idea. I now think that there may be sufficient money already in people's hands to trigger a powerful HYPERINFLATIONARY SHOCK, which could put the US on the path to hyperinflation. But Congress still has a role, if Congress never spends out those "$60,000 cheques", or never introduces massive Food Stamp, and/or Gasoline Stamp programs, the initial Hyperinflationary shock may ignite a brief burst of price rises in essential commodities. But that spurt may soon "burn itself out", if Comgress fails to "add more fuel", by engaging in some sort of emergency bailout to get money in the hands of those citizens who are suffering from the price rises.
The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#17 aliveandkicking

aliveandkicking

    Millennium man

  • Members
  • PipPipPipPip
  • 2,586 posts
  • Location:Helsinki Finland

Posted 11 September 2010 - 03:27 PM

QUOTE (DrBubb @ Sep 12 2010, 01:06 AM) <{POST_SNAPBACK}>
I am not disputing GL on property prices falling in Chile - afterall, he lived through that incident, and I did not. But it seems a bit unbelievable that Chile could experience some months of 20-30 PER MONTH inflation, and that Home prices would DROP in escudo terms.


1. He says on his blogg he was "too young to experience it first hand"

2. As far as i am concerned he clearly tells us why asset prices collapsed in local currency:

http://gonzalolira.b...-will.html#more

Chile experienced hyperinflation, brought about by the failed and corrupt policies of Salvador Allende. Though I was too young to experience it first hand, my family and some of my older friends have vivid memories of the Allende period—vivid memories that are actually closer to nightmares.

The causes of Chile’s hyperinflation forty years ago were vastly different from what I believe will cause American hyperinflation now.

Salvador Allende was a hard-core Socialist, it’s clear that Allende wanted to implement a Maoist-Leninist regime, with himself as Supreme Leader.

One of the key policy initiative Allende carried out was wage and price controls. In order to appease and co-opt the workers, Allende’s regime simultaneously froze prices of basic goods and services, and augmented wages by decree.

private companies—forced to raise worker wages while maintaining their same price structures—quickly went bankrupt: So then, of course, they were taken over by the Allende government, “in the name of the people”. Key industries were put on the State dole, as it were, and made to continue their operations at a loss, so as to satisfy internal demand. If there was a cash shortfall, the Allende government would simply print more escudos and give them to the now State-controlled companies, which would then pay the workers.

the situation in Chile deteriorated in ’72 and into ’73, the stock market collapsed, the housing market collapsed—everything collapsed, as people either

cashed out of their assets in order to buy basic goods and staples on the black market,

or

cashed out so as to leave the country altogether.

No asset class was safe, from this sell-off—it was across-the-board, and total.


#18 DrBubb

DrBubb

    Tri-Millennium Guru

  • Super Admins
  • PipPipPipPipPip
  • 67,101 posts
  • Gender:Male
  • Location:Hong Kong & London
  • Interests:Trading and investing in stocks and commodities. Writing articles on related subjects, while building this website. I am interested in creating ways for communities

Posted 11 September 2010 - 03:40 PM

QUOTE (aliveandkicking @ Sep 12 2010, 12:27 AM) <{POST_SNAPBACK}>
the situation in Chile deteriorated in ’72 and into ’73, the stock market collapsed, the housing market collapsed—everything collapsed, as people either cashed out of their assets in order to buy basic goods and staples on the black market, or cashed out so as to leave the country altogether. No asset class was safe, from this sell-off—it was across-the-board, and total.[/i]

Seems to me he cannot join the dots. Or he is just looking for attention for his films.

Perhaps it is not easy to get the data...
But I think he should have a look at interest rates during that episode, and see what impact they had upon housing.

I can imagine that there were rent controls (holding revenues down), while mortgage borrowing costs sky-rocketed,
making the ownership of a mortgage-financed property, which was tenanted to a rent-controlled tenant, a cash-draining
situation. The holder of such an "investment", would have to cover the cash shortfall, from his own (limited) resources.

This would explain why someone might want to swap a negative Cash Flow apartment, for a dodgy student-owned car.



The market is "bipolar", swinging back and forth from a focus on Inflation to Deflation. Bet on swings; and stay flexible. What are bipolar markets? See: http://tinyurl.com/GEI-Manix

#19 aliveandkicking

aliveandkicking

    Millennium man

  • Members
  • PipPipPipPip
  • 2,586 posts
  • Location:Helsinki Finland

Posted 11 September 2010 - 04:02 PM

QUOTE (DrBubb @ Sep 12 2010, 03:40 AM) <{POST_SNAPBACK}>
Perhaps it is not easy to get the data...
But I think he should have a look at interest rates during that episode, and see what impact they had upon housing.

I can imagine that there were rent controls (holding revenues down), while mortgage borrowing costs sky-rocketed,
making the ownership of a mortgage-financed property, which was tenanted to a rent-controlled tenant, a cash-draining
situation. The holder of such an "investment", would have to cover the cash shortfall, from his own (limited) resources.

This would explain why someone might want to swap a negative Cash Flow apartment, for a dodgy student-owned car.


Maybe it is just simpler? If the government are going to fully implement maoist leninist thinking as per GL you will not be allowed to own property. So you run for the hills while you can.

http://gonzalolira.b...-will.html#more

Allende wanted to implement a Maoist-Leninist regime, with himself as Supreme Leader.

#20 Nigel Watson

Nigel Watson

    Centurion

  • Members
  • PipPip
  • 261 posts

Posted 11 September 2010 - 06:12 PM

QUOTE (romans holiday @ Sep 11 2010, 03:48 PM) <{POST_SNAPBACK}>
So is that it? Is that what the hyper-inflation case rests on? Are people so gullible to take this threat at face value, and see it as credible and not incredible? I've been calling this the Bernanke bluff for years. It's a bluff because they can not actually do it... there are legal and political constraints on what the Fed can do. Where does this idea of omnipotence come from. blink.gif

Some might say it's all a schoolboy fantasy, but I couldn't possibly comment on that. laugh.gif



Read about the hyperinflations of the past on the net. How many of these hyperinflations have been prompted by posting the equivalent of $60 000 to households.

Answer: none.

If you've studied hyperinflations you'll know that they're certainly not caused by a sudden increase in wages either.

1970s wage price spiral is NOT hyperinflation

Hyperinflations are caused by a currency repudiation, which leads to a sudden surge in velocity. Cash previously printed by CBs to combat 'deflation' suddenly enters the real economy and.......kaboom

(no need for mocking /moronic smilies)




0 user(s) are reading this topic

0 members, 0 guests, 0 anonymous users