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Sunday, June 14, 2009
I want to cover quite a bit of background here to properly set up today's topic of Inflation vs. Deflation. But because of my schedule, this would require stringing out three reports over five weeks, and given where we stand in the markets today, that isn't ideal. There is much afoot, and I want you to be armed with as much timely information as I can provide.
So we are going to jump to the end and discuss the conclusions before the background. I will fill in the background in a later Martenson Report. If you find this report difficult to follow for this reason, I invite you to re-read it again after the background information comes out in a few weeks. I appreciate your understanding.
Executive Summary
- Inflation correlates best with government spending.
- Inflation/deflation is a dance that exists between the supply/demand for money and the supply/demand for goods and services.
- Most government spending growth is in mandatory categories - not simple to reduce.
- Inflation will bail out debtors? Don't count on it.
- Future generations have been consigned to a tremendous economic challenge.
- Prepare now for upcoming destructive inflation.
Your faithful information scout,
Chris Martenson
Copyright 2009, Chris Martenson. All rights reserved.
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Comments
Very thought provoking report Chris, thank you. Just when I get desperate for a Chris Fix, you come through. Thanks for jumping right into the epicenter of this debate.
I have to say, I hadn't really thought of things quite this way before...
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Super report Chris!
Thanks!
We continue to travel down a very dark road…and it’s difficult to make out exactly what’s at the end of it. The details just aren’t clear, but sadly enough the rough outline in the approaching distance is…and it’s nothing less than both depression and hyperinflation...
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Great post Chris. I especially liked the part you mentioned about business owners. This is one of the reasons I decided to sell my business. Let us hope that inflation will occur in the next few years and not right away. At least I have some time to sort things out with the business...
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Thank you Chris for bringing clarity and data to an alarming subject.
idoctor wrote:
We continue to travel down a very dark road…and it’s difficult to make out exactly what’s at the end of it. The details just aren’t clear, but sadly enough the rough outline in the approaching distance is…and it’s nothing less than both depression and hyperinflation...
Enroll today to read more.
Great report; I hadn't previously realized the significance of the government spending vs CPI inflation correlation. Seem to me regardless of what one thinks should happen based on economic theory, there are strong indicators in the past data...
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LYS and Tom,
I'm intrigued by your comments re "using borrowed money toward an inflation hedge". They raise a couple of questions:
1. What sort of inflation hedge's do you have in mind?
2. Do you consider PM's in that category?
3...
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I second the above comments re this report. One reason I'm here (apart from the fine company) is that I keep on learning. I dig learning!
Viva -- Sager
Sam,
Yes, PMs are at the top of the list.
If no inflation comes, then the strategy fails. That's why I said, "if you're willing to bet the farm on inflation."
So, is it a risky move? Yes, I suppose.