Are You Concerned About Inflation?

by Simon 112 Replies latest social current

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  Simon

  I saw a statistic the other day that something like 25% of all the debt that the US has incurred since 1776 was created in the last 12 months. That's because they have printed so much currency and instead of letting that stop them, they are going to continue printing more to go on a spending spree on crazy green-new-deal schemes and union handouts.

  Does anyone think that this can be anything other than inflationary? They are effectively stealing the wealth of everyone to then hand money out to people. Idiots will think they are getting free money or a $15 minimum wage but it's really the poorest who will suffer the most from the inflation tsunami wave that is going to hit the economic shoreline at some point.

  I don't know about you but the cost of goods and services seems to be going up way more than the fictional basket used for the consumer price index. It isn't 1-2%, try more like 10-20% at least.

  So I have a question for you. If you really believe that the money-printing can be done without inflation, then why do they need taxpayers? Instead of taking my taxes why don't they just print the equivalent instead?

  That way we'll all be even richer! ... right?
• 

  Steel

  The biggest danger to inflation was Trump artificially protecting American jobs and passing the increase into the consumer . Where were the fiscal hawks when Trump was running his monster deficits.
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  minimus

  Steel, I find it amusing that you couldn’t respond to Simon’s question and simply blamed Trump. I have to admit though, you make this place enjoyable to me.😛
• 

  minimus

  You can’t spend all this money that we don’t have. It’s an illusion.
• 

  Steel

  All that really matters is if a nation can sell its debt and pay next to nothing in interest. A few years ago Germany was selling bonds at a negative interest rates and nations were buying them. They were safe. Greece was offering 10-15% returns and no one would touch them.

  The US is never going to pay down any debt. All that matters is if they can service the interest. As long as GDP keeps growing, its not really an issue. Japan has twice the debt to GDP ratio of the US.
• 

  GrreatTeacher

  Well, if you want to slow down inflation, you raise interest rates.

  The Fed can do that.
• 

  Steel

  My dad left high school in 1971 and started working as a Mechanic. He started at $ 2.15 an hour and by 1981 he was making 23.00 dollars an hour. Then the bank of Canada said enough was enough and interest rates went from 6% to nearly 20%. If you owned money, you were royally screwed. If you had money in the bank, you were making out a bandit.

  I remember as a kid my parents paying 800 dollars for a VCR. Some of the purchases we think nothing of today were really big commitments in the 1980s. Free trade has really been our saving grace over the last 20 years because no one is getting raises.

  I hope when the vaccine rolls out that the supply chains go back to normal.
• 

  GrreatTeacher

  Yes. In a low interest rate environment borrowers make out and investors lose.

  In a high interest rate environment borrowers lose and investors make out.

  Remember in the early 80s you couldn't afford to buy a house because the interest rates were 18%?

  But, if Grandma kicked off, you were making money hand over fist with your inheritance.

  And if you had bought a house previously and were now paying it off with inflated dollars, you were REALLY making out!

  I also remember when VHS movies were $80 to purchase. That's why Blockbuster was such a success. I think there's only one of them left in Alaska now or something.
• 

  MeanMrMustard

  Yes. I am worried. I am going to get out of dollars and into assets this year.

  The interest rate can’t be held low. If it is, the currency will inflate beyond reason. If it is allowed to find the market rate, the US will default.
• 

  GrreatTeacher

  Any opinions about Bitcoin?

  Quite a few young people dumping the stock market and buying Bitcoin.

  I foggily understand it, but I can't really predict the repercussions on the economy.

  I'm not talking about mining it because few people have the ability to do that. From what I understand, you can buy it like you can securities, but there's no regulation at all. It's a bit of the Wild, wild west.

  But, then again, my foggy understanding might be, well, foggy.

  BTW, I dumped most of my stocks last year and moved my investments in a more conservative direction. I think Wall Street is wobbly and I'm waiting for a market correction.