Posted on 02/13/2013 6:55:47 AM PST by blam
Art Cashin: A Dormant US Inflation Indicator Just Spiked, And It's Got Me Thinking Of Weimar And Zimbabwe
Sam Ro
February 13, 2013, 3:58 AM
Veteran trader Art Cashin has been more concerned about the threat of inflation in the U.S. than most.
In a recent interview with Eric King of King World News, he notes that the once dormant threat of inflation could be waking up.
From King World News:
...That having been said, the Federal Reserve Bank of St. Louis puts out what is called the ‘Monetary Stock.’ It is the ‘raw material’ of the money supply, and it has been dormant throughout the year.
The report for the first part of this year suddenly spiked higher, and it’s something that I’m going to keep a very close look at. It may be, and there is some seasonality, but I think people need to begin watching the money supply, particularly the M2, and see if that starts to accelerate...
If the velocity of money begins to accelerate and M2 begins to move up, then you will begin to hear people talking about or at least worrying about inflation again..."
Cashin notes that this isn't just theory. Indeed, we've seen it before in history. Most people know the of the most notorious experiences: Weimar Germany and Zimbabwe.
Somebody once asked a famous literary character (who lived through the Weimar hyperinflation) how did he go broke? He said, ‘Slowly and then suddenly.’ The Weimar Republic saw inflation develop very slowly, and then suddenly. Once it developed it was almost like Zimbabwe except it was in a major nation, and destroyed the moral values of a whole civilization and basically led to the underpinnings of World War II.”
(Excerpt) Read more at businessinsider.com ...
I remember doing this in the early 80's.
Indeed. Dave Ramsey and Glenn Beck are very clear and uncompromising in their “no debt” philosophy, but if one really believes that inflation is imminent and their income will inflate as well, then debt is king.
Yes, I know, those sectors are not counted in the inflation index.
5.56mm
Manipulate the economy and the reporting of it's performance and spend massive amounts of borrowed and printed money to give a false illusion of normalcy and economic health in the first term to get re elected.
Then all hell breaks loose in the second term, providing multiple crisis to justify the institution of draconian control over the American people.
It was a simple plan.
It worked.
We are screwed.
Inflation is the gift that keeps on giving to the big government types.
It’s all good for them, and all bad for normal people.
Your comment on inflation and government is interesting.
My Economics professor told us this back in 1982.
or as Ronald Reagan told us in a long-forgotten speech,
“These Washington types actually use inflation as a part of deliberate economic planning!”
and inflation is doubly good for big govt so long as they can lie about it and thus not give raises to retireees who depend on those raises to keep up with inflation.
Compare the value of the dollar of the years when the dow was at 1100 and now...Todays 1400 aint nothing to bragg about...
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