The Death of Inflation

[biglentil]

Errol, I think its time to revisit this. The last few months have told the story of whats coming.

Trillions printed up and more to come under Biden. More money has been printed up in the last yr than in all the yrs prior combined. Fed reserve has stopped reporting M2 because its so massive and growing exponentially every day.

And this time, unlike the 70s, the money has a 3 fold effect. First trying to engineer a great reset for the climate hoax, secondly people getting direct payments and buying scarce goods and services that havent rebounded from covid or even buying stocks and lastly with fiat money crashing in value, there is an entire group of retail and institutional speculators trying to park it in real assets to preserve wealth. Homes, cars, equipment, collectables, commodities, value stocks.

And at the same time the fed has to hold the 10yr at low levels so they are buying bonds and MBS on the other end.

This has to be the most risky and dangerous economic experiment since Weimar.

Weimer 1922 six months prior to hyperinflation, we have all 5 of the same markers present in our current economic environment necessary for hyperinflation. Off the top of my head the five markers are rapidly expanding monetary supply, high levels of debt, markets based on speculation not investment for productivity, corruption (crony capitalism check), and growing centralization of control. Many millionaires made in 1922 many became trillionaires 1923. So wealthy infact some would heat their homes with wheelbarrows full of money.

[errolanderson]

Money printing doesn’t lead to hyperinflation. Case in-point: Japan. Japan has no inflation and a lost generation of wealth.

Fed Chair Powell's 60 Minutes segment on Sunday just shows how fearful central bankers are of incoming deflationary risks (IMO). They can't say the word. Powell suggested that U.S. inflation is very tenuous . . . that 2%, if touched may not hold long. That is an understatement in my view.

We are just one stock market correction away from a major devaluation of assets that have been artificially supported by money printing. There is simply no substance or long-term footing for inflation given the magnitude of government and personal debt loads.

The only way out of this is; "the piper eventually gets paid" . . . and that translates into pennies on the dollar.

[GDR]

Biglentil I too have a project that has been put on the backburner. I'm looking about 40% higher build cost this spring compared to last summer when I was making plans. Piss on it I'll wait! Countless people I have talked to are in the same boat. The pendulum always swings too far to the detriment of the market then bounces back the other way.

[Guest]

me too , **** those *** mills
pricks are wrecking highways with their 84mt loads cause they can't get by hauling 64mt like everyone else
and then gouging the shit out of us on OSB, lumber, plywood , etc.
**** those greedy bastards , they will get their day
like $50+ for a sheet of OSB,$100 for plywood
hope they starve
thought trudeau said price gouging would not be tolerated during Covid?????????

[biglentil]

It can definitely take the wind out of one's sails with prices like these. Have a homebuilder friend concerned about the spec homes he is starting.

[errolanderson]

Margin debt is skyhigh, now estimated in-the-trillions. This is going to be one hell of a margin call when it blows. Powell dismissed and appeared unaware the magnitude of margin on 60 Minutes.

1999 ... 2008 ... now 2021

[Taiga]

Do we really think prices are going to come down? Think prices like these are sustainable in this business?

[biglentil]

Mpca !
[ATTACH]7775[/ATTACH]

[errolanderson]

The incoming deflationary shock and credit market defaults will catch the investor herd totally unsuspecting (IMO).

Even plywood prices are susceptible to-a-markdown.

[biglentil]

The incoming deflationary shock and credit market defaults will catch the investor herd totally unsuspecting (IMO).

Even plywood prices are susceptible to-a-markdown.

You've been saying deflation is coming since plywood was $26 a sheet and calling for golds sell off since $900. I've been hearing about deflation risks for 20years and I've been calling bullshit for that long. It's just jawboning by the fed all the while they continue to print and steal the purchasing power of the savers. Increasing money supply is INFLATION, price inflation is the result. That is the definition as per the Merriam Webster Dictionary from early 1900's to the 1970's until the Keynesians forced them to change it to align with a cooked CPI model to significantly understate real world price inflation. Do you honestly believe the economy is struggling to maintain a 2% price inflation rate currently?

[biglentil]

You can’t make this shit up. Comic book produced by the NY Fed outlines exactly what’s going on today.

https://twitter.com/HayekAndKeynes/status/1388308624431255555?s=19 https://twitter.com/HayekAndKeynes/status/1388308624431255555?s=19

[biglentil]

You can’t make this shit up. Comic book produced by the NY Fed outlines exactly what’s going on today.

[sumdumguy]

Cycles repeat. The thing is, there were probably the same predictors over and over again all through the years. Who hasn’t heard the old folks warning the next generation about prices rising, too much borrowing? All I am saying is I’ve heard this song and dance repeatedly. When we were buying land in 1972 at $100/acre, our father was saying, “You’ll never pay for that, the price is way too high”. The borrowers were the winners (except when interest rates went to 22%). Could that happen again? That would put the brakes on, wouldn’t it?

[Ache4Acres]

I’ve basically been calling for a collapse of the dollar for nearly 20 years and yes it may seem to some like I’m the boy that cried wolf but I would say thing look more than ever like I will be right in the near future.

Interest Rates can never increase significantly again without bringing a complete collapse of the system. The amount of debt in the world compared to 1980 is literally astronomical.

This is not a matter of if but when. In the interim they feel like the way out is taxation (carbon tax), currency devaluation and quasi inflation. That’s the same old game plan. The inflation (read devaluation) of your currency is estimated to be around 15% per year right now. If you are not making 15% on your money you are losing your wealth.

The only asset in the world that has outperformed the money printing in last 12 years is bitcoin. Other commodities and assets like real estate have faired well too but really treaded water compared to the Feds balance sheet expansion.

[biglentil]

Pictures going up!