Is the United States currently experiencing inflation, deflation or stagflation? Are we heading into hyperinflation? What effect will this have on gold and silver price?
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From King World News: Today, Rick Rule spoke with King World News about spectacular home runs some investors have been hitting in the gold, silver, and crude oil markets. Rule, who is now part of Sprott Asset Management, also predicted, “… gold and silver prices will trade higher in the six to 12 month time frame.” But first, here is what Rule had to say regarding QE and the inflation/deflation debate: “A [...] Dear Readers, I doubt anyone will settle the inflation-deflation debate any time soon, or at all, until it becomes a matter of the historical record. That’s not because it’s in any way unknowable or subject to that oft-cited cop-out: “too many variables.” It’s because the answers have political implications, and those make people with differing views resistant to arguments and data that contradict their views. Selective blindness and amnesia are, alas, far [...] I use the dollar in the description of Credit Default swaps for a basis as they could be denominated in any fiat currency. Understand that the dollar is the defacto “Reserve currency – Petrodollar” that the world uses to transact business. As that dollar becomes more encumbered with “leverage” its ability to be a store of value has less conviction and faith. The “only” value that a fiat paper currency can [...] Has anyone read “The New Depression” by Richard Duncan? In this book, Richard Duncan proposes that we replace the Quantitative Theory of Money with the Quantitative Theory of Credit. The Quantitatve Theory of Money is the mechanism by which many economists like Milton Friedman explain inflation/deflation. The theory stated in an equation is: MV = PT where M = Money supply, V = Velocity of money, P = price, and T = volume of transactions. Bacically [...] Prime Minister Mariano Rajoy said Spain’s situation is one of “extreme difficulty” and signaled that his budget cuts are less painful than a bailout would be, as demand for the nation’s debt slumped at an auction. “Spain is facing an economic situation of extreme difficulty, I repeat, of extreme difficulty, and anyone who doesn’t understand that is fooling themselves,” Rajoy told a meeting of his People’s Party today in the southern coastal city of Malaga. Rajoy [...] Bernanke’s splendiferous defense of all things holy and Central-Bank-like this afternoon has a little for everyone – if you spent the time to listen/read his entire lecture. For those who did not, perhaps the following word-cloud sums up his perspective – and its odd subliminal messaging. The words Gold and Standard appear more times than Central and Bank; the words Policy and Economy are almost equal in number and very close [...] By Howard Gold NEW YORK (MarketWatch) — You’ve heard it so often you can probably repeat it in your sleep: Equities are the best protection against inflation. Financial planners say it. Money managers say it. Pundits and gurus say it. Without a nice chunk of equities in our portfolio, we are told, inflation will ravage our net worth and we may not have anything left for our very old [...] It could happen but probably not here and now. Ideally the Fed wants to keep things nuetral – offsetting the natural tendancy toward deflation by reflating……..the banks. Make no mistake, what the Fed is doing now is repairing balance sheets of the TBTF banks. Backstopping assets, suspending mark to market accounting, handouts via the discount window are all attempts to keep the banking game alive. It can be argued that [...] This is opinion only, but I would NOT buy housing unless the property was in a semi-rural or in-town rural community where you could be part of a community (safety in numbers) and grow at least a good-sized kitchen garden. Straight farm acreage is currently in a rising speculative bubble yet home prices are dropping: you might even get a better deal on farmable land if it was a large lot [...] In traditional banking, Deflation is a disaster Here’s a grossly simplified version of why: When banks in the US lend they do so by leveraging their capital. If they have $1 million they can go on to lend $10 million which is a 10:1 ratio. This extra $9 Million they are legally allowed to “conjure” into existence (yes it’s true) which is the main way our money supply is expanded. Or as many like [...] If it were marked to market you would see deflation and a much stronger dollar due to their relative scarcity. Our government is proping assets by adsorbing and backstopping them via bailouts, TARPs, TALFs, Fannie/Freddie, market interventions etc. By adsorbing assets and stimulating the Fed is hoping to tread water while banks recapitalize. By doing so while also maintaining artificially low interest rates on treasuries it puts the currency at [...] I did my best to verify the following info, I think its pretty accurate 1. gas was $2.80 a gallon, its now $3.70 average The events of the last ten days are surely for the history books. The story must be told through a prism of the epic battle between inflation and deflation. The Jackass hates the parlance, since each term is abused. Inflation is the expansion of the monetary supply, while deflation is the decline in that supply. The Powerz would prefer that the public misconstrue what inflation [...] Inflation – An Immediate Concern We will keep our thoughts on this subject brief and straightforward. While the inflation/deflation debate is vigorously defended on both sides, and we certainly recognize the ongoing need for deleveraging which should apply deflationary pressures, it is difficult to ignore simple data which points to the contrary. In fact, we find very few assets around the world outside of US housing [...] by RobotTrader Capital One remains resilient, and is now up 4 days in a row, nearing the top end of the trading range. Pretty amazing. New highs for transports. Follow the tape. Ignore the news. Failure to follow this method will result in bankruptcy for those who trade for a living. by Chris Martenson Here at Martenson Central, we are endlessly keeping a close eye out for the emergence of deflation, defined here as the purchasing power of the dollar going up. Technically, inflation and deflation are terms that indicate a particular combination of money surplus or deficit (respectively), demand for money (of which velocity is but one measure), and demand for various goods and services (which themselves [...] by kmi Loans are about interest rates and this is the biggest risk in purchasing real estate. My opinion is that interest rates are destined to rise. If they do not, you lose nothing. Interest rates on Real Estate will not decrease (they can’t). So again, you lose nothing. There is of course a deflation risk, but I think we are 80-20 inflation-deflation right now. [...] by Larry M. Elkin, CPA, CFP® There is a “golden elephant in the room,†according to Robert Zoellick, the American who heads the World Bank. As world leaders headed to Seoul for the G-20 summit last week, gold hit a record-high price of $1,400 an ounce, and Zoellick made a surprising proposal. In an opinion piece in the Financial Times, he wrote that “The system should…consider employing gold as [...] by RobotTrader Panera making fresh, new highs today, totally unfazed by “inflation/deflation” issues… by Quixote2 I have been trying to get my brain around the future of money, gold, debt, our government, etc. Gold, money, fiat, inflation, deflation, etc Gold and silver are money, the constitution defines the dollar in silver. Fiat money is debt, generated out of thin air by borrowing by individuals; businesses; and local, state, and Federal government agencies. The Fed issues generic notes or electronic notations for this debt where [...] by Saxplayer00o1 1) France Lagarde:Dollar Can No Longer Be Only Reserve Currency-Report “PARIS (Dow Jones)–The global monetary system needs to be rethought in order to reduce the size of fluctuations, and the dollar can no longer be the only reserve currency, French Finance Minister Christine Lagarde said in an interview published Monday in French regional daily Sud Ouest. “Monetary problems will be at the center of France’s presidency of [...] by ThomasNadler “the New York Fed plans to buy $850 billion to $900 billion in Treasury notes over the next five months, including $600 billion in new purchases and about $250 billion to $300 billion to reinvest the proceeds of maturing mortgage-backed securities” $900 billion in five months amounts to about $2 trillion annualized. The market’s initial reaction suggests the market doesn’t know what to think [...] by RobotTrader Ergo, hot money is now fleeing commodity plays and piling into the SOX. As long as Interactive Brokers continues to offer 1.4% margin interest rates, the action junkies will NEVER leave the casino. We are now seeing what I predicted a week ago. They have rallied the market on rhetoric for months now of QE and now in order to feign a surprise in order to keep the momentumenomics [...] |
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Our Whole Financial System Is An Illusion
‘The Matterhorn Interview’ – July 2011
The book author, financial commentator and entrepreneur Mike Maloney talks in this exclusive interview with Lars Schall for Matterhorn Asset Management in Zurich, Switzerland about: inflation/deflation, the flaws of the current monetary system, the upcoming rollercoaster ride in crude oil, and the biggest bull market in gold and silver ever.
By Lars Schall
Mr. Maloney, is a massive financial/economic storm ahead for us [...]