Hyper-inflation knocking yet?

What are the signs to watch for in order to spot early hyper-inflation, and position yourself accordingly?

Look for long lines to buy bread at $27.50 USD per loaf.

CFA_Tool Wrote: ------------------------------------------------------- > Look for long lines to buy bread at $27.50 USD per > loaf. Hmm that might be a false positive, socialism anyone?

you would see CPI/PPI actually going up to begin with…

You have got to be kidding me!!! Inflation!!! Dude, have you looked at the TIPS spreads lately?

Over 80% of U.S. debt is purchased by foreigners, which keeps interest rates low and inflation within control. This is still the case as we speak, but things can quickly turn sour and foreigners stop buying becaue they no longer have dollars. They got the dollars in the first place from U.S. consumers who are not in good shape as we all know. The government needs foreign dollars badly to pay for bailouts and maintain its deficit spending. The U.S. needs dollars now more than ever before. The growth in money supply has to stay at its current high level, or the country will dip into severe deflation, something the government has vouched to avoid (see Bernanke’s speeach titled "Deflation: Making Sure It Doesn’t Happen Here. " from a few years ago. Therefore we may end up with a rogue money suppy crashing us into a dismal hyperinflation situation. That’s when gold shines. Let us all hope this is all wrong.

“That’s when gold shines. Let us all hope this is all wrong.” More like thats when your assault rifle shines.

I was at a conference last week where they spoke about US debt. The general theme was that foreigners will continue to buy US debt, mainly because they feel that they have to. They have to support the only country that has the ability to maintain global stability (well, not maintain but you know what I mean) both economically, militarily, etc. Therefore it is in their interest to keep the US floating by putting their money here, we also have among the lowest default rate insurance % of most countries, AAA rating (yes it means very little), etc… Therefore I dont see the threat of foreigners stopping the spout.

Foreigners would love to buy U.S. debt for the reasons you cited, but they ain’t got no more dollars unless we print it and give it to them so they can lend it to us!

not true.

hyperinflation is coming. plan accordingly. wont be tomorrow, probably not 2009 or 2010, but it’s coming.

equity_analyst Wrote: ------------------------------------------------------- > You have got to be kidding me!!! Inflation!!! > Dude, have you looked at the TIPS spreads lately? My thoughts exactly… If hyperinflation is coming and the TIPS market says deflation, how could you make an unlimited amount of money if you’re right?

aren’t we potentially talking deflation followed by hyper-inflation so both will be right? was the govt’s actions on AIG inflationary? i’m thinking they took control and imposed a new fixed charge against earnings. for sure, TARP will put some money in the economy.

Deflation followed by Hyperinflation…this is exactly what the so called “conspiracy theorists” are predicting. They also predict martial law and internment camps. So lets see how far they are correct. THAT is exactly what Bush and friends want.

JoeyDVivre Wrote: ------------------------------------------------------- > equity_analyst Wrote: > -------------------------------------------------- > ----- > > You have got to be kidding me!!! Inflation!!! > > Dude, have you looked at the TIPS spreads > lately? > > > My thoughts exactly… If hyperinflation is > coming and the TIPS market says deflation, how > could you make an unlimited amount of money if > you’re right? 1) Buy TIPS with leverage 2) If we get hyperinflation: you get lots of money, celebrate, get drunk 3) If we get more deflation than expected: you lose, cry, get drunk

louisvillegrad Wrote: ------------------------------------------------------- > Deflation followed by Hyperinflation…this is > exactly what the so called “conspiracy theorists” > are predicting. They also predict martial law and > internment camps. So lets see how far they are > correct. > > THAT is exactly what Bush and friends want. You know, I was on the subway today and absolutely *everyone* was in a bad mood (and this was in the morning). This little old lady was screaming “get out of my way” when she climbed on the subway. Others were grumpy. It was contagious. For the first time, I could see how if something like this goes on for a while, people start looking for scapegoats. It was really weird how I could feel on an emotional level how people in continuous crisis start grouping into clans fighting over scraps of meat. I could imagine how something like this could have fueled Naziism 70 years ago, and fascism in Italy, eugenics and stuff. I commented on this to a friend at lunch (who was not on the subway with me) and she said that she sensed the same thing. I sure hope that’s not the road we’re going down. It was really scary to think about.

Remember that Bush’s grandfather Prescott Bush profited handsomely from jewish slave labor in the concentration camps and was an active member of the Eugenics movement.

> My thoughts exactly… If hyperinflation is coming and the TIPS market says deflation, how could you make an unlimited amount of money if you’re right? Joey, as you know many events do not reveal themselves as we would like them to, so it doesn’t mean much that TIPS spreads aren’t showing hyperinflation yet. In addition, TIPS are not the best protection despite their name. They only protect against government admitted inflation, the CPI. You could also ask why gold is still in the low $700’s if there is any fear of hyperinflation! Same answer, we are not there yet. How soon? If I were to bet, I would say before end of 2009. Unfortunately, I’'m not the only one with a gloomy outlook.

Ludwig Von Mises on Credit Bust and Deflation: “The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” http://mises.org/humanaction/chap20sec8.asp Thoughts?