Posted on 05/23/2013 9:13:00 AM PDT by blam
Will It Be Inflation Or Deflation? The Answer May Surprise You
By Michael Snyder
May 22nd, 2013
Inflation Or Deflation
Is the coming financial collapse going to be inflationary or deflationary? Are we headed for rampant inflation or crippling deflation? This is a subject that is hotly debated by economists all over the country. Some insist that the wild money printing that the Federal Reserve is doing combined with out of control government spending will eventually result in hyperinflation. Others point to all of the deflationary factors in our economy and argue that we will experience tremendous deflation when the bubble economy that we are currently living in bursts. So what is the truth? Well, for the reasons listed below, I believe that we will see both. The next major financial panic will cause a substantial deflationary wave first, and after that we will see unprecedented inflation as the central bankers and our politicians respond to the financial crisis. This will happen so quickly that many will get "financial whiplash" as they try to figure out what to do with their money. We are moving toward a time of extreme financial instability, and different strategies will be called for at different times.
So why will we see deflation first? The following are some of the major deflationary forces that are affecting our economy right now...
The Velocity Of Money Is At A 50 Year Low
The rate at which money circulates in our economy is the lowest that it has been in more than 50 years. It has been steadily falling since the late 1990s, and this is a clear sign that economic activity is slowing down. The shaded areas in the chart represent recessions, and as you can see, the velocity of money
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(Excerpt) Read more at theeconomiccollapseblog.com ...
Finally someone mentions deflation and collapsing monetary velocity... Deflation is far, far, far worse than inflation. Deflation is what Bernanke fears most and why the fed won’t tighten too fast.
The truth is the truth.
Yep... and the key is to be wisely invested in those necessities. Like traditional energy companies.... food retail and distribution.... textiles. Not facebook, google, wind energy, etc etc.
In my case: chickens, a couple of cattle, goats, a garden, a natural spring on my property and solar power.
I don’t have it all yet, but that was my “full” to-do list when we moved here. We’re still working it.
“There’s a term in chess called zugzwang,” writes Michael Sivy at Time, “which describes the point in a game when it’s your turn to move but every move you could make would worsen your situation. That’s pretty much what the chessboard looked like for Ben Bernanke this morning.”’
"“A premature tightening of monetary policy could lead interest rates to rise temporarily” Mr. Bernanke pontificated, “but would also carry a substantial risk of slowing or ending the economic recovery and causing inflation to fall further… High rates of unemployment and underemployment are extraordinarily costly…”
It’s also why
GET THE HELL OUT OF DEBT.
Is the safest thing for you and your family.
Deflation is also inevitable - Bernanke is trying to push back a boulder with borrowed money. Eventually interest rates WILL rise, and when that happens, he’ll have the choice of deflation or hyperinflation.
You’ll be fine. 2020 is the endgame right now with the debt.
food retail and distribution.... textiles. Not facebook, google, wind energy, etc etc.
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anything that leverages the consumer is toast ,, advertising companies (meaning google , yahoo , facebook etc. which are or incorporate tools to target advertising)
having 10 acres and a herd of goats sounds pretty good...
I’m thinking of “investing” in USPS “forever” stamps as a handy currency for small purchases...
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