Hyperinflation And Double-Dip Recession Ahead

TMO ^ | 4-3-2011 | TGR/John Williams

[blam]

"You are going to see “Stagflation”... Inflation on necessity items like energy, food, and clothing (and other commodities ) and falling prices on those goods that are not as the demand is destroyed for those goods (Electronics, computers, ect)."

Smithfield CEO: Higher Food Prices Are Here To Stay

[Jack of all Trades]

That right there is either the 0.64, or the 64 bajillion dollar question.

[bert]

There was no definition given for hyper inflation.

My thought is that there will be continued inflation world wide but in the USA it will not get to the point where wheelbarrows are required.

[bert]

In my mind, that was the intent from the beginning. It was necessary to have Obama win to save the repiblic and the Republican party.

The Democrats will get the blame they deserve. It is taking time to be come apparent.

[politicianslie]

Wasted away again in Obamaville: By election time all taxpayers will get it.

Obama won’t be able to be elected dog catcher ( I HOPE! )

[montanajoe]

The weekly US government bond auctions are oversubscribed by a factor of three. That means there are three times as many potential buyers for the bonds than there are bonds available to sell. So even assuming the US government is all in there are still twice as potential buyers than the government.

A lot of this in my view has to do with the Chinese, they don't allow their currency to float on the world markets and they are sitting on a surplus of something in the neighborhood of 12 trillion US dollar up from a couple of trillion a decade ago. They have to put that money somewhere and it goes into mostly US treasuries.

Until there are US jobs created to drive wage inflation and the demand for US debt drops to a factor of say 1.5 I'm much more concerned with the prospect of deflation.

[familyop]

Yep, just in time for summer. ...25 cents down, 50 cents up, then a dollar.

[blam]

" I don't think you have until 2012 before this gets out of control and there's hyperinflation. It could go past that to 2014, but we're seeing all sorts of things happening now that are accelerating the inflation process."

I didn't 'catch' that on the first read. Did You? 2012 is only 8 months away.

That's only a short time from now, eh?

[familyop]

"I didn't 'catch' that on the first read. Did You? 2012 is only 8 months away."

No, I didn't. Thank you.

That's only a short time from now, eh?"

Yes. I did gather John's gist, and he's been proposing what most readers would see as a paradox. That is, most will assume that another recessionary dip would cause a lasting deflation in commodities.

But in today's global economy, such a lasting effect will not be so certain (although possible with introductions of more serious risks). And cooling the east Asian part of the economy, for example, could cause more serious, unforeseen problems while failing to alleviate inflation here.

Remember that world demand for the commodities in the news is higher than it was in the past, and extreme suppression of the US economy might be the only way to appreciably decrease world demand.

My guess is that we should watch for a reaction from the Fed against the latest action intended to deflate commodities. The starting gate of summer is very near (Memorial Day). Depriving services of revenues could be very deleterious to stocks preferred by interests that rely on likely increases in services for shipping loans (excuses to build inventory early next year). A bad summer could spell difficulties for those most hopeful of bringing fuel prices down (incl. freight fuel, consumer fuels, all), as well as more immediate hardships for all.

Granted, the debt madness should have been taken care of long ago, but, IMO, we're dependent on making the landing as smooth as possible now. There's nothing the Fed can do that I know of but to fire things up with more debt, if a deflationary trend starts looking like it might get out of hand. I'm not in favor of the crazy debt regime, but once we're in it so deep,...

With the nature of our global trade situation, the dollar must fall and balance, to some extents, with certain trading partners' currencies. See what happened in Argentina after its "solution" (setting that country's peso to equal the US dollar). And oil...well, given production capacities, it won't stay down, unless demand is decreased radically and consistently. My guess is that manipulations by any one or few of various interests in these matters could result in another high intensity conflict.

The various governmental and business leaders are probably treading on thin ice in regards to consequences of their actions. ...just another guess.

IMO, the best and most important move that our leaders at all levels could make would be a cessation of many regulations that are in the way of new, small manufacturing starts (domestic competition starting at the lowest levels: rural zoning ordinances and the like). Those most prevalent in global business aren't willingly going to get essential production started here. Look at their social philosophies--quite different from those of the majority of Americans. And they don't want domestic competition. Neither do many of their own family members (various social causes).

Maybe we'll have to take our lumps, and then rebuild. Maybe our forefathers were right about a lot of things.

[spokeshave]

the underlying reality is a weaker economy and rising inflation

Stagflation

[ak267]

2012 201 2012........ !!!

ANCIENT MYAN CALANDAR!!!
ANCIENT MYAN CALANDAR!!!
ANCIENT MYAN CALANDAR!!!

ARRRRRRRGHHHHHHHHH

[mamelukesabre]

Basically what this article is saying is that the USdollar is itself a bubble that is going to burst someday.

But precious metals are also resembling bubbles, somewhat, these days. this is driving me insane trying to predict what is going to happen.

[birddog]

If your choices are fiat money or PMs, I would go PMs...... Silver and Gold have value, no matter what the dollar does....

[mamelukesabre]

you can still lose half your money or more by buying metals.

[Mariner]

"OPEC might decide it no longer wants to have oil denominated in U.S. dollars"

That will NEVER, EVER happen.

The US military assures and ascertains oil delivery.

That's the bottom line.

That's the only thing keeping the dollar alive today.

[blam]

"2012 201 2012........ !!! "

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