Commodity Deflation

[errolanderson]

Farmaholic . . . You've identified the beast.

Conventional economics no longer works or make sense. Central bank money money printing or QE stimulus has been a collective and colossal failure IMO.

Central banks now have no choice but to drop their rates into negative territory to feed their own addition . . . money printing. This includes the U.S. Federal Reserve. The U.S. Is in no position to hike rates as their economy is in the early stages of contraction. Even Ben Bernanke suggested this week that the Fed may have to join the negative rate club.

Governments can no longer even remotely service their debt. And the Fed Reserve is now caught in their own web.

Stock markets have acted as a parking lot for investors desperate for yield. This is not working capital in my view.

[Rareearth]

Tweety, investing it hard tangible assets such as land and machinery are never a bad thing. These investments are a investment in your business, bigger faster better and most importantly easier, and hopefully emotionally and financially.

Investing, trusting other to do what's good for you is bad, sad, etc. It's paper. Ponzi scheme material, the stock markets and mutual funds etc. They are for the most part intangible. A bank account is addicting the bigger it get the tighter and more is invested hoping and hoping it continues to grow. It's only tangible and worth something physically and emotionally once it's withdrawn, cashed in, liquidated, etc, invest in yourself.

[foragefarmer]

Rareearth

" Ponzi scheme material, the stock markets and mutual funds etc."

Take a look at the return of any good blue chip stock ( eg. Canadian banks and Railways) with a decent dividend payment from 2009-2016. If you weren't in, you've missed one of the best bull runs ever. Just look at any long term chart of any good blue chip. Will it continue who knows, but trying to time the market can be a disaster.

Those who have been sucked in by cheap money are the ones that should be worried. Being greedy, will take care of ones who don't know when to stop. Those who live within their means will do just fine. Paying off your debt is economics 101.

Errol, with all your predictions, what have you been doing these past years to protect yourself financially (buying gold, investing, expanding, holding cash etc etc).

[perfecho]

Forage....Does that still work if you were in 2007? I don't know...don't follow stocks since I totally got out in early 2000s. We were bought out by a public company and I worked with them for a while....when I saw how they managed...it was all out.

[cottonpicken]

Luckily the whole world decided to devalue at the same time.

Anyone here want to bet on a currency value when their government is monetizing the debt(qe) on a solo mission-its ****ed its toast,christ they are absorbing collateral losses on corporate now,pump and dump teams keeping stocks up,keeping commodities in check(150 dollar oil is not good for an economy),creating ever great distortions,which leads to roads to nowhere,overcapacity and dislocations in the free market capitalism concept.

The funny thing is everyone knows its ****ed now.

[foragefarmer]

Prefecho

Just using BMO as an example, in 2007 it was $70.00/share, it then fell to $30.00 in early 2009, it is now $85.00. The thing to remember is that it pays a good dividend throughout. The other thing good blue chip companies should be bought at all times, in other words someone might have bought some BMO at $70.00 in 2007, but also could have been bought at $30.00 in early 2009 and have done very well by cost averaging.


Like a said before, trying to time the market can be a disaster.

[perfecho]

Someday soon, should start cashing in assets...but where do you park money....the market scares me...haven't spent time with it. Would like to find some youngsters that have a great idea, some motivation and gamble with them.....at least I can drop in now and then to see how things are going.

[Rareearth]

Forage you are right, my bad choice of wording.
I was thinking that with govts all over the world money printing, this is where most cash goes. Government policy, they give and they will take away. The average person has no choice, or few choices stock markets or banks. Governments are printing money, where is it going? The companies are good yes, solid yes, over valued yes. The returns have been very good over the last number of years, when a bubble pops, and we have all seen it to many times, how fast will the returns diminish, and what will the actual returns be when or if the stocks are actually sold? " current returns or values are no indication or guarantee of future returns". This is a difficult debate, if, when, how, who, etc future unrolls should be interesting.

[errolanderson]

'where do you park money' is likely on most everyone's minds.

what concerns me is; recently there were comments that a 10% correction in the S&P could wipe some major U.S. pension funds. The pressure for the Fed NOT to crack the equity bubble is immense. And hiking U.S. rates rhetoric is exactly that threat.

Markets are damned if they do and damned if they don't. And central banker guidance is now in total dis-array (IMO).