We all know that our cost of living in increasing, but how much?
The official government statistics assure us that inflation is running around 2% per year. It reminds me of the line attributed to Groucho Marx, “Who are you going to believe, me or your own eyes?”
According to the surveys, real people think their personal inflation rate is around 8% per year with a significant percent of the responders claiming 9 – 11% or more per year. Are you going to believe what the government is telling you or your own experience? [Read more...]
What is YOUR Inflation Rate?
Silver Prices, Inflation and Living With the Long Term
The silver market is seeing a new wave of buying emerge once again as prices soften. This is much like what occurred during the notable market dip down to the 8.44 level seen in October of 2008.
Short term anxiety in the silver market tends to play into the hands of the mainstream financial media that loves to cherry-pick data in order to support the sentiment flavor of the day.
This sentiment is normally biased against holding hard assets like silver, resulting in them being misunderstood or scorned.
Furthermore, as the trading range for silver widens and awareness grows of silver as an investment vehicle, more people will have bought the metal at higher levels within the trading range. They therefore tend to suffer from buyers’ remorse if the market subsequently falls.
Long Term is a Different Story [Read more...]
Adam Hamilton: Real SPX Record Highs
Submitted by Adam Hamilton:
The US stock markets enjoyed an incredible first quarter, with the flagship S&P 500 stock index (SPX) surging 10.0%. New cyclical-bull highs were achieved on an amazing 3/7ths of all Q1’s trading days! But the most interesting one was certainly the last. On Q1’s final trading day, the SPX edged up to a new all-time record high. Though celebrated with great fanfare, adjusted for inflation it was far from a record.
Thanks to central banks rapidly inflating their fiat-money supplies, long-term price comparisons are problematic. As the Fed relentlessly injects new money into the US economy every day, the purchasing power of each dollar slowly erodes away. A dollar today buys less than a dollar did 5 years ago, and the farther back you go the greater the disparity. Considering inflation is essential in any long-term analysis. [Read more...]
Deepcaster: Riding the Big Profits Kahuna – How Much Longer?
Submitted by Deepcaster:
The Equities and Bond Markets have been riding The Big Kahuna of Fed, ECB, Bank of England (and now the Bank of Japan’s) Q.E. et al. for several Years Now.
But for how much longer can Investors expect to ride these Market Boosting Central Bank Injections and other Interventions before Disaster strikes and the use of QE reveals itself to be clearly Counter Productive?
Increasingly, these Interventions are seen to be Disasters: [Read more...]
Kyle Bass On ¥1 Quadrillion in Debt: The Japanese Zone of Insolvency-They’re Finished!
For those unable to attend the Initiative on Global Markets conference in March, legendary fund manager Kyle Bass gave a shocking and eye-opening 48 minute presentation on Japanese debt, and how the ¥ will be the first currency to crash and burn in the rapidly escalating global currency war:
The Japanese interest expenditure is nearly ¥11 Trillion. To put that in perspective, their tax revenues are ¥43 Trillion. Japan is spending 1/4 of their tax revenue on interest alone today, with interest rates at zero (5 year bonds are at 17 basis points).
This is the zone of insolvency! There is no looking back! If Abe and Kuroda really achieve some sort of inflationary outcome, and the swaps move, they’re finished. Every 100 basis point move in cost of capital costs Japan ¥11 Trillion. A 200 basis point move has their debt service exceeding central government tax revenue! Those wishing for inflation do not know what they wish for!
Bass’ full MUST, MUST WATCH presentation on Japanese & global debt markets is below: [Read more...]
The Chart That Should Disolve The Fed- 1775-2013: Hockey Stick Inflation
As the chart produced by Reinhart & Rogoft in the following brief Bloomberg clip demonstrates, after remaining constant for approximately 150 years, consumer prices have risen nearly 30 FOLD since the Fed was created in 1913.
The chart that should dissolve the Fed: 1775-2013: Hock Stick Inflation: [Read more...]
“Gold Is The Ultimate Money” says Ron Paul
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Dr. Ron Paul was interviewed by Fox after the U.S. Federal Reserve confirmed it will continue its QE program highlights the importance of gold as money.
On July 13, 2011, when Dr. Paul was a U.S. Congressman he asked U.S. Fed Chairman, Ben Bernanke, “Do you think gold is money?” and Bernanke replied, “No, it’s a precious metal.” Dr. Paul countered, “Even though it’s been used for 6,000 years?” But Bernanke denied gold was money and said, “No, it’s an asset. Just like T-Bill’s are not money.”
The Fox News interviewer then commented, “Cyprus has taught us that governments can confiscate money that you’ve earned or even paid taxes on. Rampant quantitative easing and price fixing by governments may prop up the stock markets but it doesn’t keep unemployment down. The U.S. Fed is going to continue its QE program which is good for gold.” [Read more...]
JS Kim: We’ve All Been Cyprus’d Already!
In this excellent report by SmartKnowledgeU’s JS Kim, JS discusses the attempted theft of 10% of Cypriot funds by the European banksters, and points out that the Western Central banksters have routinely been executing a far greater theft against everyone than any of the numbers proposed in Cyprus.
People are rightfully infuriated over the bankers’ attempt to steal 10%+ of all Cyprus bank accounts recently to bail out the banks. What people must realize is that bankers have been executing a far greater theft against all of us through inflation than the proposed Cyprus theft and here’s what we can do to stop it. [Read more...]
FOMC: QE Continues at $85 Billion a Month for Indefinite Future! Metals Smash in Progress!
Fed leaves QE at $85 billion/month
- Inflation target 2%
- Gold & silver raid in progress!2:02 PM Update: Metals retrace entire algo smash!
Full March FOMC Statement is below: [Read more...]
Alasdair Macleod: The Relationship Between Money and Prices
Not all prices rise at the same time, nor do they rise evenly. Furthermore, the equation of exchange cannot differentiate between price changes that emanate from demand for goods and those that emanate from changes in preference for money – two effects that can produce very different results.
These unknowns are effectively wrapped up in that catch-all, velocity of circulation. [Read more...]
Deepcaster: Forecasts Facilitating Gain
Submitted by Deepcaster:
“I don’t know when it’s going to end. But my guess is it’s going to end very badly. And it’s going to end very badly because, again, when you get the biggest price in the world, interest rates being manipulated, you get a mis-allocation of resources and this is going to end in one of two ways: with a mal-investment bust which we got in 07-08 […] Or it could end with just monetizing the debt and ‘off we go’ inflation. So that’s a very binary outcome. They’re both bad.”
The Fed’s and other Central Banks’ Money Printing is surely facilitating Serious Malinvestment, which almost inevitably leads to a Bust i.e., to Economic Stagnation or even Depression.
But that Money Printing is also already leading to Inflation. Result: Stagflation is impending, or, more likely, Hyperstagflation. [Read more...]
Deepcaster: Bogus Official Statistics Offer Profit Opportunities
Submitted by Deepcaster:
“There is no paper money in 2014 or 2015 that will be worth much of anything.” – Jim Rogers
Investors are increasingly concerned, understandably, about the Reliability of Official or Quasi-Official (e.g., those emanating from Too-Big-To-Fail Banks and Ratings Agencies) Statistics and other Financial and Economic News.
Understandably so, given that the actions of Participant Mega-Financial Institutions in the LIBOR Scandal cost Borrowers Billions.
Understandably so, if the allegations in the Ratings Agency litigation are proven true, Investors in deceptively “Rated” Mortgage-Backed Securities, and other commercial Paper have taken a Financial Bath there also.
Understandingly so, given the continuing Flood of Bogus Official Economic Statsitics.
But the Mismatch between Bogus “Statistics” and “News” on one hand and the Real Numbers and Real News on the other provides Opportunities to Profit and Protect. This is because Bogus Statistics and Disinformation give rise to inherently Unsustainable Trends and misallocation of Capital.
Peter Schiff: Inflation Propaganda Exposed
In the latest Schiff Report, Peter Schiff discusses a topic regular SD readers are familiar with- the government’s manipulation of public perception of inflation due to the bogus CPI statistic.
Schiff states that The CPI is no longer a tool to accurately measure inflation, but an instrument of propaganda the government uses to hide accelerating inflation from the public and financial markets. Modest CPI increases over the past several years do not reflect an absence of inflation, but a design flaw in the index that fails to fully capture the magnitude of price increases. Central bankers drawing economic conclusions regarding inflation and monetary policy based on this highly flawed data point are making a major policy error.
Schiff’s full report below:
[Read more...]
The Inflation – Deflation Reality in 2013
Submitted by Deepcaster:
The five year chart of the CRB Index (a Broad Measure of Commodities Prices) shows three descending tops, which is suggestive of Deflation. But to conclude that Deflation is likely to be The Ruling Force in the Economy in 2013 would be a Dangerous Error.
Indeed, it is critically important for Investors to understand whether or not we are in an Inflation or Deflation, or both (we later explain how this is possible). Failure to understand The Reality about Deflation and Inflation is likely lead to poor or even lethal Investment decisions.
Here we explain The Inflation/Deflation Reality and indicate how to Profit.
In 2013, we will continue to see inflation in terms of the US dollar currency, and deflation in terms of gold.
[Read more...]
Deepcaster: Mega-Banks Pushing for Mandatory Gov’t Securities Investment in All Retirement Accounts
Submitted by Deepcaster:
The Prospective Rigging of the CPI Calculation for Social Security recipients would , yet again, make the “Official” CPI even further removed from The Inflation Reality. The Reality is that the current U.S. Inflation Rate, 9.4%, is already Threshold Hyperinflationary.
The Key Point for Investors is understanding the Motivation behind Government and Mega-Banks pushing for Mandatory Government Securities Investment, and changing the way Inflation is calculated.
The Powers-that-Be in the Global Banking and Finance community know that the ever-increasing Money Printing – QE to Infinity – is already leading to increasing Price Inflation, which they wish to hide, and thus eventually to Massive Sales of Paper Treasury Securities, for which they wish to have Buyers, via 401(K) Funds. [Read more...]
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