Total sales are rising ten percent a year in nominal terms.   Surprise surprise, shadowstats estimates ten percent inflation per year if we use the measure of inflation that was used in the the 1980s.   Hawaiian Libertarian reports that that is pretty much what he is seeing when he puts his money down. So what is the true rate of inflation? There is no one true rate of inflation, since to …
Tag: fiat money
hyperinflation of the US$
A great storm first manifest as clouds on the horizon. The Republicans are going to wish they had not won the 2010 November elections. Supposedly US inflation is near zero, yet food, fuel, and heating oil has risen substantially. Gonzalo points out Grains as a class have risen over 33% year-over-year. Refined oil products have risen just shy of 13%, with home heating oil rising 18% year-over-year. In other words: …
Where the money went
The government has been shuffling the money around to obfuscate who stole it. It lends money, and then announces that there is no problem, the money has been paid back. But after much fiddling, the money has mostly come to rest, in that the government is now the proud owner of about one trillion dollars of mortgage backed securities guaranteed by Fannie, Freddie, and the FHA, plus some Fannie, Freddy, …
American debt
Thus the excess “private” debt is not private. The normal level of public and “private†debt is about twice GDP, say twenty six trillion, so we are about thirty trillion or so in the hole and getting deeper fast – well past the danger level of twice GDP.
Prospects of hyperinflation
Incumbents that engage in hyperinflation usually gain political benefit in the short run, and the short run is all they care about. The Weimar government was not punished at the polls.
Inflation looms
The bond market does not tell us what the smart money people think inflation will be. It tells us what those among the smart money people who do not expect very high levels of inflation think inflation will be.
In addition to an on budget deficit of ten percent or so, there is also a much larger off budget deficit, in the form of an ever growing pile of government guarantees, which there is no will to restrain. Put the two deficits together, crisis looms.
Trees do not grow to the sky. That which cannot continue, must stop
Yes, the Fed can just keep on printing money.
The business times quotes an anonymous “senior London Banker†Someone will go under in this crisis, that’s for sure. The question is whether they stay under or get rescued. Let’s see whether this latest round of stabilisation helps, but if it doesn’t, it’s difficult to see what Plan B is. The Fed can’t just keep on printing money. Yes, the Fed can just keep on printing money. The banks have …