tag:blogger.com,1999:blog-1592992209402300549.post1448271922105855284..comments2024-03-28T08:06:43.198-04:00Comments on The Silicon Graybeard: Inflation or Deflation? SiGraybeardhttp://www.blogger.com/profile/00280583031339062059noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-1592992209402300549.post-74804301247538888632012-09-19T15:31:51.413-04:002012-09-19T15:31:51.413-04:00Yes, deflation will occur... in terms of Gold, and...Yes, deflation will occur... in terms of Gold, and specie currency. Deflation absolutely will not occur in terms of USD/FRNs, Euros, Yen, or Fiat currency. To expect otherwise is completely contradictory with economic history, and contrary to the incentives structure of the power players. Central Banks and Governments are in a hyper inflationary trap. Once a nation reaches a certain point, they cannot change course, it's like a black hole, once you cross the event horizon, you are no longer traveling /acting to move toward the hole, it pulls you in. The Fed is no longer in control, they are compelled to print. They cannot allow currency deflation to occur, because that would require honesty, and would destroy the banks, and would very likely put their own selves in danger from the same. Inflationary policy keeps the banks alive short-term and enriching the bankers before hyperinflationary collapse, or currency restructuring is forced upon them. Deflation can be stopped in it's tracks immediately by printing infinite amounts of money, just as FDR did in the 30s (de-pegging gold). He stopped it in it's tracks. Deflation has IMMEDIATE and CLEAR consequences and causation to all people, inflation has diminishingly good short term consequences and potentially disastrous consequences LATER (most importantly). <br /><br />The incentive system is what matters. "Qui Bono" In deflation, the savers win, in inflation the monied interests win. That's most important. <br /><br />To believe in USD/FRN deflationary collapse, is to believe in something that has never happened in recorded history, and in fact, the opposite. As long as there are humans able to create more currency or debase what exists, those currencies will debase/inflate. Additionally, it's a hell of a lot easier to debase a currency when it only exists digitally (no coin or paper). That is why of all the hyperinflationary episodes, most have occurred since the 20th century. Hyperinflation is a modern problem. <br /><br />You're and engineer... Look at the historical empirical data, it's pretty clear. There have been 29 recorded hyperinflations in history, 28 in the 20th century, one, the french revolution earlier. <br /><br />I highly recommend you go read:<br /><br />Monetary Regimes and Inflation - Peter Bernholz<br />This time is Different - Reinhart, Rogoff<br />Dying of money - Jens O'Parsson<br />everything at "fooledbyrandomness.com" and all Taleb's books<br />Human Action - Ludwig Mises<br /><br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-1592992209402300549.post-15801507336696366002012-09-19T00:31:24.179-04:002012-09-19T00:31:24.179-04:00"I'll take Economic Catastrophes for $500...<i>"I'll take Economic Catastrophes for $500, Alex". <br /><br />"The answer is, ' QE3 and the current depression ends in this' ".</i><br /><br />"What is <a href="http://www.xkcd.com/849/" rel="nofollow">the wavefunction is multiplied by its complex conjugate</a>?"Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-1592992209402300549.post-79531344209717925272012-09-19T00:23:50.358-04:002012-09-19T00:23:50.358-04:00It will be both. Simultaneously.
Virtually all ...It will be both. Simultaneously. <br /><br />Virtually all assets will deflate - real estate, stocks, bonds, vehicles - etc. - while commodities essential for sustenance will skyrocket. <br /><br />The fed et al will stop at nothing to re-inflate the burst balloons - but it will not work. As has been shown.<br /><br />But that is just my opinion - YMMV.<br /><br />itorAnonymousnoreply@blogger.com