tag:blogger.com,1999:blog-8515247115132134144.post5144746743342448580..comments2024-02-17T12:34:01.400-08:00Comments on Illusion of Prosperity: If It Truly Was the Fed's Goal to Hyperinflate...Stagflationary Markhttp://www.blogger.com/profile/04568993350246477976noreply@blogger.comBlogger25125tag:blogger.com,1999:blog-8515247115132134144.post-22957798864490213872012-11-16T19:02:52.108-08:002012-11-16T19:02:52.108-08:00Yeah, no kidding. I've heard a lot about those...Yeah, no kidding. I've heard a lot about those stars things some people get to see.Craig Brandenburghttps://www.blogger.com/profile/11563245849016059647noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-15975921400249724012012-11-15T23:25:40.494-08:002012-11-15T23:25:40.494-08:00Craig M. Brandenburg,
That's a great point.
...Craig M. Brandenburg,<br /><br />That's a great point.<br /><br />Perhaps immortality wouldn't be so bad in the emptiness of space if one had severe memory loss.<br /><br />Think of the wonder each time you opened your eyes and saw the Milky Way galaxy!<br /><br />Seriously. I've been going on a lot of walks at night lately. Looking up at the same stars never seems to get old to me.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-31076719247494049022012-11-15T22:44:39.999-08:002012-11-15T22:44:39.999-08:00Mark, ha! Well, immortality would be a curse at th...Mark, ha! Well, immortality would be a curse at the least because forever is a long time to suffer from dementia and other forms of brain rot. I mean, your mind is finite, so even in the best of scenarios you would have to be infinitely forgetful in order to handle an infinite amount of time.<br /><br /><br /><br /><br />Craig Brandenburghttps://www.blogger.com/profile/11563245849016059647noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-83029780969440343732012-11-14T17:05:13.767-08:002012-11-14T17:05:13.767-08:00Craig M. Brandenburg,
Anyone whose job is gotten ...Craig M. Brandenburg,<br /><br /><i>Anyone whose job is gotten and maintained by being elected by the general population or by being appointed by an elected official has great incentive to keep both hyperinflation and deflation at bay for as long as possible. But that fact alone doesn't say anything about what's possible to achieve with policy.</i><br /><br />That's certainly true. All we can really debate is how long it will be possible. If I was granted the curse of immortality, then I would definitely brace for hyperinflation. Since there is a small risk it happens each year, it becomes a "sure thing" if given an infinite number of years.<br /><br />As a side note, I say immortality would be a curse. Here's why.<br /><br /><a href="http://en.wikipedia.org/wiki/Sun#Earth.27s_fate" rel="nofollow">The earth's ultimate fate is precarious.</a><br /><br />What will I do to amuse myself in the emptiness of space once it's gone? An eternity of nothing might be one definition of hell.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-26194421298550893282012-11-14T16:55:33.419-08:002012-11-14T16:55:33.419-08:00Jazzbumpa,
Hahaha!
I'm talking about the evi...Jazzbumpa,<br /><br />Hahaha!<br /><br />I'm talking about the evil genies, not the ones <a href="http://en.wikipedia.org/wiki/I_Dream_of_Jeannie" rel="nofollow">I dream</a> about! ;)Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-500464449820294032012-11-14T16:43:47.051-08:002012-11-14T16:43:47.051-08:00Anyone whose job is gotten and maintained by being...Anyone whose job is gotten and maintained by being elected by the general population or by being appointed by an elected official has great incentive to keep both hyperinflation and deflation at bay for as long as possible. But that fact alone doesn't say anything about what's possible to achieve with policy.Craig Brandenburghttps://www.blogger.com/profile/11563245849016059647noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-66883517937700891082012-11-14T15:55:00.519-08:002012-11-14T15:55:00.519-08:00Youse tryin' to make me think inflation is a G...Youse tryin' to make me think inflation is a GOOD thing?!?!<br /><br />JzBJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-66787732837062409212012-11-14T15:44:37.243-08:002012-11-14T15:44:37.243-08:00And if we really want a good model to explain it a...And if we really want a good model to explain it all, we definitely need to throw in income and wealth inequality.<br /><br />Give an extra trillion dollars to a billionaire and not much will probably happen to the price of a can of soup.<br /><br />Give an extra thousand dollars to a billion people and the price of soup could easily rise.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-32430632999757687522012-11-14T15:37:08.513-08:002012-11-14T15:37:08.513-08:00TJandTheBear,
This is just an opinion of course, ...TJandTheBear,<br /><br />This is just an opinion of course, but I think there are still an abundance of disinflationary forces at work.<br /><br />1. There's a lot more robots can do.<br /><br />2. Think how much cheaper things could get if we removed some of <a href="http://youtu.be/IUIQX5esnNo" rel="nofollow">these</a>!<br /><br />You tell me which is gallows humor and which is simply the truth and we'll both know. ;)Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-86460097219186126672012-11-14T15:33:58.056-08:002012-11-14T15:33:58.056-08:00Jazzbumpa,
In my example, the bottle is aluminum!...Jazzbumpa,<br /><br />In my example, the bottle is aluminum!<br /><br />"Inflation is always and everywhere a monetary phenomenon." - Milton Friedman<br /><br />I don't believe it for a minute, and clearly you don't either.<br /><br />It could just as easily be said that deflation is always and everywhere an overabundance of aluminum production problem.<br /><br />In my opinion, you cannot use the exponential increase in the money supply to make sense of the price of a can of soup without also looking at the exponential increase in the amount of soup produced!Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-23963137767792397002012-11-14T14:49:33.936-08:002012-11-14T14:49:33.936-08:00Still, it throws a monkey wrench into "Inlafl...Still, it throws a monkey wrench into "Inlaflation is always and everywhere a monetary phenomenon."<br /><br />JzBJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-54826810505405661472012-11-14T14:15:10.402-08:002012-11-14T14:15:10.402-08:00Much faster money supply growth with much slower i...<i>Much faster money supply growth with much slower inflation.</i><br /><br />There was an abundance of disinflationary forces at work during that time (e.g., China).TJandTheBearhttps://www.blogger.com/profile/10735388072841457108noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-70531801898905283102012-11-14T14:13:49.456-08:002012-11-14T14:13:49.456-08:00This comment has been removed by the author.TJandTheBearhttps://www.blogger.com/profile/10735388072841457108noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-70126825961178948822012-11-14T07:32:09.457-08:002012-11-14T07:32:09.457-08:00Mark -
You're always goading me to look at th...Mark -<br /><br />You're always goading me to look at things in different ways.<br /><br />I stripped CPI out of your MZM chart to get actual quantity per cap and threw CPI onto the right hand scale, both as logs.<br /><br />What this suggests is that the genie and the bottle have no definable relationship.<br /><br />I put the discontinued M3 series on there as well, to show the specific measure of money doesn't make much difference.<br /><br />http://research.stlouisfed.org/fred2/graph/?g=cP1<br /><br />Inflation was super-exponential until the early 80's, and since then has been slightly less than exponential, since the slope is declining slightly.<br /><br />But since the early 80's the slope of money growth has increased - indicating a greater exponent.<br /><br />Much faster money supply growth with much slower inflation.<br /><br />Milton Friedman was a liar.<br /><br />JzB<br /><br />Jazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-85216971026470000902012-11-14T06:13:02.835-08:002012-11-14T06:13:02.835-08:00dd,
Then again, savers getting a return of their ...dd,<br /><br /><i>Then again, savers getting a return of their investment when they need it may be a thing of the past too.</i><br /><br />Today's <a href="http://www.bloomberg.com/markets/rates-bonds/government-bonds/us/" rel="nofollow">-1.44% real yield on the 5-year TIPS</a> would tend to back your point.<br /><br />It would seem that the era of great investment returns and wage growth relative to even relatively tame inflation ended in 2000. Sigh.<br /><br /><br />Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-27301137163695568032012-11-14T05:59:43.787-08:002012-11-14T05:59:43.787-08:00mab,
Nice!
I should supply a chart using my old ...mab,<br /><br />Nice!<br /><br />I should supply a chart using my old TRS-80 Model III in honor of the Shadow Stats data. That $999 computer (1982 price) is up to the task. I'm sure of it! <br /><br />Shame on the US government for trying to claim that old computer is hedonically less useful to me! Sure, it didn't have a hard drive. It didn't have a mouse. The tiny monitor was black and white. It had an 8-bit processor and just 16k of memory. That means nothing!<br /><br />And while I'm at it, I'm going to make it play Borderlands 2 as well, if it is the last @#$%ing thing I ever do! That's how much I respect the Shadow Stats data!! Hahaha! ;)Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-41109175455845534882012-11-14T05:46:16.384-08:002012-11-14T05:46:16.384-08:00With the Fed and Treasury's vanquishing of the...With the Fed and Treasury's vanquishing of the "independent"<br />regulatory agencies via FOSB the bottle is getting an aluminum<br />casing. Inflation will be contained<br />and bank runs will be a thing of the past ie<br />Geithner's move to turn "liquid" money market funds<br />into gated short term bond funds and together with the rules<br />limiting bank withdrawals (read the fine print)<br />inflation will be contained because liquidity for the everyday Joe<br />will be controlled. Combine that with Joe's<br />wage deflation and hyper-inflation is a thing of the past.<br />Then again, savers getting a return<br />of their investment when they need it may be a thing of the past too.ddhttps://www.blogger.com/profile/05372482865160613159noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-35674334444667489412012-11-14T04:01:27.000-08:002012-11-14T04:01:27.000-08:00Can we get a ten year annualized chart of Shadow S...Can we get a ten year annualized chart of Shadow Stats data?<br /><br />Time to prove I'm not a robot. You'd think the foolish nature of my comments would be enough! <br /><br />mabnoreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-72037283928487865512012-11-13T23:32:13.093-08:002012-11-13T23:32:13.093-08:00Here's a bonus thought.
As a saver, I'm a...Here's a bonus thought.<br /><br />As a saver, I'm at least thankful that the Fed seems to realize that exponentially growing inflation rates will not bring us prosperity.<br /><br />I suspect that they really don't want to let that genie out of the bottle. They allowed the genie to escape in the 1970s and it was very difficult to put it back in.<br /><br />I think it is safe to say that the genie has grown in power over the past few decades. That makes it very dangerous.<br /><br /><a href="http://research.stlouisfed.org/fred2/graph/?g=cOv" rel="nofollow">Real MZM per Capita (September 2012 Dollars)</a><br /><br />The hyperinflationists would point to that chart as proof of what is to come. I think they are missing one important thing though.<br /><br />The bottle is stronger too!<br /><br /><b>November 29, 2009</b><br /><a href="http://illusionofprosperity.blogspot.com/2009/11/quantity-theory-of-aluminum.html" rel="nofollow">The Quantity Theory of Aluminum</a><br /><br /><i>In aluminum economics, the quantity theory of aluminum is the theory that aluminum supply has a direct, negative relationship with the price level.</i><br /><br />It seems very unlikely that we will hyperinflate if <a href="http://www.kitcometals.com/charts/aluminum_historical_large.html#5years" rel="nofollow">aluminum prices</a> don't go up.<br /><br />Just an opinion!Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-65410364472768657582012-11-13T23:11:19.420-08:002012-11-13T23:11:19.420-08:00Just to be clear, here's the math for the late...Just to be clear, here's the math for the latest point.<br /><br />September 2002 CPI: 181.000<br />September 2012 CPI: 231.407<br /><br />(231.407/181.000)^(1/10) = 1.0249<br /><br />Annualized inflation rate over previous 10 years = 2.49%<br /><br />I used the CPI that wasn't seasonally adjusted because...<br /><br />1. It went back further in time.<br />2. Seasonal adjustments weren't needed (since the 10 year duration was a multiple of full years).Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-39288850999160786052012-11-13T22:48:46.981-08:002012-11-13T22:48:46.981-08:00TJandTheBear,
Illustrates the inflation/deflation...TJandTheBear,<br /><br /><i>Illustrates the inflation/deflation push-pull nicely, doesn't it?</i><br /><br /><a href="http://www.youtube.com/watch?v=3mbBbFH9fAg" rel="nofollow">Black Hole Sun</a>Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-27927933618589222932012-11-13T22:42:29.874-08:002012-11-13T22:42:29.874-08:00Jazzbumpa,
I just annualized the 10 year rate of ...Jazzbumpa,<br /><br />I just annualized the 10 year rate of change. No averaging. It is what it is.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-40945608988732301552012-11-13T21:11:26.617-08:002012-11-13T21:11:26.617-08:00Illustrates the inflation/deflation push-pull nice...Illustrates the inflation/deflation push-pull nicely, doesn't it?TJandTheBearhttps://www.blogger.com/profile/10735388072841457108noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-82947315653305468672012-11-13T19:38:12.917-08:002012-11-13T19:38:12.917-08:00Is your CPI chart a 10 Yr rate of change, or did y...Is your CPI chart a 10 Yr rate of change, or did you do some averaging?<br /><br />Interesting observation.<br /><br />JzBJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-47156712519791958212012-11-13T18:15:31.444-08:002012-11-13T18:15:31.444-08:00As a side note, I looked at SSRI when I turned bea...As a side note, I looked at SSRI when I turned bearish in 2004. I also looked pretty hard at NEM. I decided to pass.<br /><br />I really was just trying to preserve capital. I put 1/3rd of my nest egg in physical gold and silver instead. I sold the metals in 2006. They treated me very well.<br /><br /><i>Past performance does not guarantee future results or success.</i><br /><br />It's just another quote from the email I got today. I definitely think it applies here.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.com