| Author |
 Topic  |
|
|
Country
1000+ Penny Miser Member
USA
3121 Posts |
 Posted - 10/23/2009 : 20:38:12
|
"What the monetarists (or the first of them to be equipped with computers) found was that when the growth rate of the money supply rises:
The initial effect is on the prices of bonds and stocks, an effect that comes within a few months.
The peak effect on the growth rate of economic activity comes about 18 to 30 months after the pick-up in the growth rate of the money supply.
The peak effect on the rate of consumer price inflation comes about 12 to 18 months after that, which is to say it comes 30 to 48 months after the peak growth rate in the money supply. "
You must be logged in to see this link.
|
---> Come to the new and improved realcent: http://realcent.org
The things that will destroy America are prosperity-at-any-price, peace-at-any-price, safety-first instead of duty-first, the love of soft living, and the get-rich-quick theory of life.
Theodore Roosevelt
|
|
|
tmaring
Penny Collector Member
USA
302 Posts |
Posted - 10/23/2009 : 21:02:25
|
All that assumes that things are working like usual. All you gotta do is throw in a New Madrid event, a terrorist nuke attack, a big hurricane or tsunami, an attack by Israel on Iran, or N. Korea on S. Korea, or China on Taiwan, or India on Pakistan or... you get the idea. Our economic future is walking a tightrope without a net, and almost anything could knock it over to shatter in pieces. The dollar could devalue 40% almost overnight... and be worth nothing within a year. It could happen this weekend, quite possibly even.
|
 |
|
|
Delawhere Jack
1000+ Penny Miser Member
USA
1680 Posts |
Posted - 10/23/2009 : 22:07:54
|
On a Tuesday....... Don't ask me which one....
But seriously.........Maybe Wednesday morning...
Sooner than most people expect would be my guess. Information is much more readily available now than ever before, and the whole world knows that the dollars they hold are "hot potatoes".
It's like a game of musical chairs. Like Tmaring said, any number of possible events could provide the wind that knocks the house of cards down.
|
"Educate and inform the whole mass of the people... They are the only sure reliance for the preservation of our liberty." Thomas Jefferson
|
|
|
|
Country
1000+ Penny Miser Member
USA
3121 Posts |
Posted - 10/24/2009 : 08:29:34
|
I have to disagree with you guys. If we have an EVENT, the pattern has been for the herd to SELL everything and BUY dollars and treasuries; like last year during the financial panic of 2008. I think the herd will continue to do just that.
If there is to be a demise of the dollar, I believe the worst case scenario for the dollar will come about slowly - sort of like slowly melting ice - drip, drip, drip - oops nothing is there it has all melted away. |
---> Come to the new and improved realcent: http://realcent.org
The things that will destroy America are prosperity-at-any-price, peace-at-any-price, safety-first instead of duty-first, the love of soft living, and the get-rich-quick theory of life.
Theodore Roosevelt
|
|
|
|
theo
Penny Hoarding Member
USA
588 Posts |
Posted - 10/24/2009 : 13:25:48
|
quote:
Originally posted by Country
I have to disagree with you guys. If we have an EVENT, the pattern has been for the herd to SELL everything and BUY dollars and treasuries; like last year during the financial panic of 2008. I think the herd will continue to do just that.
If there is to be a demise of the dollar, I believe the worst case scenario for the dollar will come about slowly - sort of like slowly melting ice - drip, drip, drip - oops nothing is there it has all melted away.
Remember that a few things have changed since last year. We have incurred considerably more debt with no end in sight to the spending. The stimulus package will have, at best, a limited effect on the economy prompting the government to pour even more stimulus into the economy. There have been hundreds news stories and public statements from foreign governments questioning the future value of the dollar. The investing public is increasingly aware that the dollar is an ineffective store of value. Therefore it is very possible that during the next "event" many investors will turn to gold, silver and other hard assets as a safe haven rather than the green back. Once the masses start to figure this out the velocity of spending increase dramatically causing prices to increase by the week, then by the day and, finally, by the hour. In the end the dollar's value will melt away like an ice cube. . . of course that ice cube will in a blast furnace.
|
|
|
|
jonflyfish
Penny Hoarding Member
USA
693 Posts |
Posted - 10/25/2009 : 06:31:53
|
Shock liquidations would see some initial strength in the USD, but it is NOT the preferred "flight to safety" choice anymore.
Last year, the USD strength was not as much of a flight to safety as it was the account denomination for all of the unwinding of leverage and gearing. That is primarily due to having been the reserve currency. Times are changing as we all know.
The USD has been the global reserve currency of overwhelming choice, but not any longer.
Why would you scramble to park your assets in a declining fiat currency- esp if the catalyst is an economic shock, which will lead more diluted fiat funny "money"... TARP 2.0, 3.0, 4.0...Zimbabwe parallelisms |
The first panacea for a mismanaged nation is inflation of the currency; second is war. Both bring a temporary (and false) prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunities. |
|
|
|
Ponce
Penny Hoarding Member
Cuba
630 Posts |
Posted - 10/25/2009 : 11:53:53
|
Check the price of everything, from week to week, and you will see inflation at its best.
What will break the camels back will be when the price of oil starts to go up once again. |
"If you don't hold it, you don't own it"...Ponce |
|
|
|
redneck
1000+ Penny Miser Member
1273 Posts |
Posted - 10/26/2009 : 10:31:51
|
quote:
Originally posted by Ponce
Check the price of everything, from week to week, and you will see inflation at its best.
What will break the camels back will be when the price of oil starts to go up once again.
I agree with that statement.
When oil starts to move everything will move and move quickly.
I believe a big move will occur after the holidays, they would not want us to close our pocket books before then.
>
|
|
|
|
Ponce
Penny Hoarding Member
Cuba
630 Posts |
Posted - 10/27/2009 : 01:34:49
|
Sorry to tell you guys but there are to many different thing in the fire that could blow up all at once........like a house of cards that if you pull one card out the whole thing collapses.
At one time my thoughts were that it would happen slowwwwwwwwwwwwly but no longer, it will happen all at once in order to put everyone in a state of shock and then the government will be more able to controll the situation. |
"If you don't hold it, you don't own it"...Ponce |
|
|
|
Copper Catcher
Administrator
USA
2092 Posts |
Posted - 10/27/2009 : 11:29:19
|
quote:
Originally posted by Country
I have to disagree with you guys. If we have an EVENT, the pattern has been for the herd to SELL everything and BUY dollars and treasuries; like last year during the financial panic of 2008. I think the herd will continue to do just that.
If there is to be a demise of the dollar, I believe the worst case scenario for the dollar will come about slowly - sort of like slowly melting ice - drip, drip, drip - oops nothing is there it has all melted away.
I hope you are right but I respectfully disagree. While I think most countries in the world are in situations much like our own there will be no love loss around thre world if the US dollar fails.
After looking at the debt clock....can anyone come up with a logical solution to paying back what is owed without bankrupting everyone? |
|
|
|
Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
Posted - 10/27/2009 : 15:48:51
|
hyperinflation and deflation are psychology triggered. it will happen when a certain mass of people realize their dollars are worthless.
at some point not far away, uncle sam is going to have bonds roll over and no buyers. this may already have happened, since some suspect the fed is printing money to finance the debt. this is called monetizing the debt, quantitative easing, or just plain no one wants to lend us the money. first, the value of the dollar falls in relation to other currencies. foreigners notice it. imports get more expensive. shortly after this, people will buy stuff rather than hold dollars. the price of stuff will start going up. as people notice the price of stuff going up, they start buying more stuff faster. there will be a dramatic change in psychology from being prudent and paying down debt to lets spend it while its still worth something. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
|
Edited by - Lemon Thrower on 10/27/2009 15:50:11 |
|
|
|
jonflyfish
Penny Hoarding Member
USA
693 Posts |
Posted - 10/27/2009 : 15:55:25
|
| The US will further increase money supply. It is the cure all for sickness. Too bad such a quick fix remedy destroys the liver, kidneys and lungs. Tarp 2 yet to come. |
The first panacea for a mismanaged nation is inflation of the currency; second is war. Both bring a temporary (and false) prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunities. |
|
|
|
beauanderos
1000+ Penny Miser Member
USA
2408 Posts |
Posted - 10/27/2009 : 17:28:34
|
I think we're more likely to see a sudden, rather than gradual devaluation of the dollar in coming weeks/months. My prediction? We'll see 2,3, 5% drops in the dollar index over consecutive weeks, rather than an overnight 50% drop, so if that puts me in the drip drip camp with Country, so be it.  |
Hoard now and hold on!
http://coppermillions.blogspot.com/
http://wherewillyoubein2012.blogspot.com/ |
|
|
|
country_bumpkin
Penny Sorter Member
USA
86 Posts |
Posted - 10/27/2009 : 18:01:07
|
The warmer the sunshine, the faster the drips.
If enough people think: hmmm, maybe I should keep $5,000 in Euros stuffed in the mattress, to heck with dollars - the drips will be even faster. Especially when goofs like Krugman say we need a massive stimulus to get the economy going again.
|
He who goes a-borrowing, goes a-sorrowing.
- Benjamin Franklin |
|
|
|
Nickelless
Administrator
USA
5580 Posts |
|
|
Nickelless
Administrator
USA
5580 Posts |
Posted - 10/27/2009 : 19:39:39
|
quote:
Originally posted by Lemon Thrower
hyperinflation and deflation are psychology triggered. it will happen when a certain mass of people realize their dollars are worthless.
at some point not far away, uncle sam is going to have bonds roll over and no buyers. this may already have happened, since some suspect the fed is printing money to finance the debt. this is called monetizing the debt, quantitative easing, or just plain no one wants to lend us the money. first, the value of the dollar falls in relation to other currencies. foreigners notice it. imports get more expensive. shortly after this, people will buy stuff rather than hold dollars. the price of stuff will start going up. as people notice the price of stuff going up, they start buying more stuff faster. there will be a dramatic change in psychology from being prudent and paying down debt to lets spend it while its still worth something.
Thanks for pointing that out, Lemon Thrower. Check out this article which says the same thing:
You must be logged in to see this link. |
Visit my new preparedness site: Preparedness.cc/SurvivalPrep.net
--Latest article: Stocking up on spices to keep food preps lively
---------------
Be prepared...and prepared to help: http://www.survivalblog.com/charity.html
Are you ready spiritually for hard times? http://www.jesusfreak.com/rapture.asp |
|
|
|
beauanderos
1000+ Penny Miser Member
USA
2408 Posts |
|
|
Nickelless
Administrator
USA
5580 Posts |
|
|
beauanderos
1000+ Penny Miser Member
USA
2408 Posts |
Posted - 10/27/2009 : 23:27:31
|
| Oops, you're right Nickelless. I threw in an unnecessary word on the URL. After reading this guy's emails and convicted as I am that the dollar is going to crash hard (50%) within the next six months I decided to try a credit card strategy with silver. Bought a fair amount on credit (little man's carry trade) and am only making the minimum payments, intentionally. With interest and principal if silver does double in six months I sell half, pay off the card, and made a 750% profit using someone else's money. You determine the amount of indebtedness you're willing to risk, the principle is to let debt and inflation work to your advantage instead of saving and being penalized for it with infinitesmal interest that diminishes even further with taxes and inflation. |
Hoard now and hold on!
http://coppermillions.blogspot.com/
http://wherewillyoubein2012.blogspot.com/ |
|
|
|
jonflyfish
Penny Hoarding Member
USA
693 Posts |
Posted - 10/27/2009 : 23:40:50
|
quote:
Originally posted by country_bumpkin
The warmer the sunshine, the faster the drips.
If enough people think: hmmm, maybe I should keep $5,000 in Euros stuffed in the mattress, to heck with dollars - the drips will be even faster. Especially when goofs like Krugman say we need a massive stimulus to get the economy going again.
Why would Euros be exempt from fiat fiasco? |
|
|
|
Nickelless
Administrator
USA
5580 Posts |
Posted - 10/27/2009 : 23:47:04
|
| Beauanderos, I'd thought about trying that a while back but then decided against it because after crunching the numbers and really examining my budget, there were plenty of other areas I could cut expenses instead of going deeper into debt. You're taking a gamble buying PMs or other prep items on credit because nobody knows when inflation will start to take off, so you don't know how far down the road you'll be able to start paying set dollar amounts with a hyperinflated money supply. |
Visit my new preparedness site: Preparedness.cc/SurvivalPrep.net
--Latest article: Stocking up on spices to keep food preps lively
---------------
Be prepared...and prepared to help: http://www.survivalblog.com/charity.html
Are you ready spiritually for hard times? http://www.jesusfreak.com/rapture.asp |
|
|
|
Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
Posted - 10/28/2009 : 06:04:51
|
quote:
Originally posted by Nickelless
quote:
Originally posted by Lemon Thrower
hyperinflation and deflation are psychology triggered. it will happen when a certain mass of people realize their dollars are worthless.
at some point not far away, uncle sam is going to have bonds roll over and no buyers. this may already have happened, since some suspect the fed is printing money to finance the debt. this is called monetizing the debt, quantitative easing, or just plain no one wants to lend us the money. first, the value of the dollar falls in relation to other currencies. foreigners notice it. imports get more expensive. shortly after this, people will buy stuff rather than hold dollars. the price of stuff will start going up. as people notice the price of stuff going up, they start buying more stuff faster. there will be a dramatic change in psychology from being prudent and paying down debt to lets spend it while its still worth something.
Thanks for pointing that out, Lemon Thrower. Check out this article which says the same thing:
You must be logged in to see this link.
so there are 2 things that are not well understood imho. first, hyperinflation because it has a large psychological aspect cannot be predicted with certainty. you can look at all the money you created and say ok so far no problem everything must be all right. rather, there is a tipping point. all this money is like water behind a dam. creating more just makes it worse. so just because we haven't seen inflation from all this government money printing does not mean we won't and does not mean it will be mild when it comes.
second, hyperinflations typically occur in bad economies. economists who say things like you can't have inflation when there is no job growth, etc. don't understand history, don't understand the velocity of money, and don't understand how dangerous all that money behind the dam is. velocity of money is just a fancy term that means peoples preferences for spending or saving. right now everyone is freaked out because either they lost their job or know several people who have. so they are cutting back, etc. when they see prices double they will change their view and will quickly start spending their money before it loses any more of its value. so far the erosion of the dollar has been masked by the Fed manipulating interest rates and similar erosions in most foreign currencies.
me i'm converting dollars to pms. pre-buying physical goods. my water heaters are old and could probably last a year or 2 more but i'm replacing them with 12-year ones. if you have been saving for something imported buy it now. i want a zoom lens for my camera. its made in japan. it will be out of reach once hyperinflation comes. guns and ammo the same thing. of course, this only makes sense if you don't have debt - we are all different ages on this board, etc. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
|
|
|
|
jonflyfish
Penny Hoarding Member
USA
693 Posts |
Posted - 10/28/2009 : 06:15:28
|
And there there is always the concept of stagflation as seen in the late 70's to early 80's.
Unfortunately, high unemployment AND inflation can coexist. |
The first panacea for a mismanaged nation is inflation of the currency; second is war. Both bring a temporary (and false) prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunities. |
|
|
|
Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
Posted - 10/28/2009 : 06:15:38
|
quote:
Originally posted by jonflyfish
quote:
Originally posted by country_bumpkin
The warmer the sunshine, the faster the drips.
If enough people think: hmmm, maybe I should keep $5,000 in Euros stuffed in the mattress, to heck with dollars - the drips will be even faster. Especially when goofs like Krugman say we need a massive stimulus to get the economy going again.
Why would Euros be exempt from fiat fiasco?
exactly.
i would rather have silver, gold or copper than even euro, cdn, yen, yuan, or swiss franks. those are all paper currencies. they may do better than the dollar but i don't see them doing better than metal. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
|
|
|
| |
Topic |
|
When Will Inflation Really Hit Us?
Forum Locked
