Hyperinflation Might Occur Some Day, Probably A Long Time From Now
Hyperinflation might occur some day, probably a long time from now, but, the current crashing real estate market, tight mortgage and retail credit (autos, electronics, credit cards, store credit cards, etc) lending environment, crashing credit/debt instruments (a $330 Billion market (Credit Default Swaps?) became illiquid altogether), a stock market bear market since mid (Russell 2000)/late (S & P 500) 2007, crashing interest rates (plummeting money market rates), etc have obviously resulted in an extremely deflationary environment, see http://tradethecycles.blogspot.com/2008/05/more-on-crashing-velocity-circulation.html.
Actually, there WAS some hyperinflation in 2004, 2005, and early 2006 in the real estate market and other things.
Deflation is a decrease in the prices of goods and services, usually tied to a contraction of money in circulation. I add: How about a very strong decline in the velocity/circulation of money due to the unraveling of the credit/debt instruments, much tighter lending standards, etc, see http://www.bullandbearwise.com/VelocityChart.asp. It's not just the amount of money in circulation, it's also the activity of the money in circulation. Activity is much higher in inflationary and/or good times/cycles than in deflationary cycles/bad times, such as we're in now.
This is why the Sharper Images and Circuit Citys are in trouble (both are in bankruptcy I think), because, there isn't a lot of money chasing non essential goods now relative to a few years ago, AND, the activity of the money in circulation is sharply declining.
A lot of cash is being used up due to skyrocketing gas and grocery prices. The commodity bubble is actually deflationary in terms of consumer spending and the economy, because, it robs most consumers of the extra cash needed to buy non essentials.
The world's central banks are trying to inflate the economy out of a huge deflationary mess, but, it'll take a long time to inflate us out of it, which is why a commodity/gold/oil 18 month+ Cyclical Bear Market is imminent, and, might have/basically already has (could be a double top with the 3-17-08 cycle high at $1033.90) begun for gold.
.......http://www.JoeFROCKS.com/ .
NEM XAU HUI
Actually, there WAS some hyperinflation in 2004, 2005, and early 2006 in the real estate market and other things.
Deflation is a decrease in the prices of goods and services, usually tied to a contraction of money in circulation. I add: How about a very strong decline in the velocity/circulation of money due to the unraveling of the credit/debt instruments, much tighter lending standards, etc, see http://www.bullandbearwise.com/VelocityChart.asp. It's not just the amount of money in circulation, it's also the activity of the money in circulation. Activity is much higher in inflationary and/or good times/cycles than in deflationary cycles/bad times, such as we're in now.
This is why the Sharper Images and Circuit Citys are in trouble (both are in bankruptcy I think), because, there isn't a lot of money chasing non essential goods now relative to a few years ago, AND, the activity of the money in circulation is sharply declining.
A lot of cash is being used up due to skyrocketing gas and grocery prices. The commodity bubble is actually deflationary in terms of consumer spending and the economy, because, it robs most consumers of the extra cash needed to buy non essentials.
The world's central banks are trying to inflate the economy out of a huge deflationary mess, but, it'll take a long time to inflate us out of it, which is why a commodity/gold/oil 18 month+ Cyclical Bear Market is imminent, and, might have/basically already has (could be a double top with the 3-17-08 cycle high at $1033.90) begun for gold.
.......http://www.JoeFROCKS.com/ .
NEM XAU HUI
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
11:50 AM
5 Comments:
Most gold writers are obviously colored by bias and/or are clueless or corrupt/frauds, which means they can't be taken seriously.
Does anyone honestly think that there's too much money chasing too few goods right now?
By
Joe Ferrazzano, at 2:41 PM
How about the US Dollar bottoming at 70.70 on 3-17-08! It has a very large very bullish inverse spike on 3-17-08's candle. Has a single gold writer besides myself pointed this out?
By
Joe Ferrazzano, at 2:43 PM
Cycles rule! Gold Pimps DROOL! Guess what a bear or bull market is pimp? It's a cycle ASSHOLE!
By
Joe Ferrazzano, at 2:24 PM
I launched this Trade the Cycles Blog in November 2005, because, I knew that Blogs were the future.
By
Joe Ferrazzano, at 2:57 PM
About a month ago Target reported that the delinquency rate on their credit card was about 8%, which is obviously sky high. This shows that, not only is there obviously not too much money chasing too few goods, but, many people can't even make the monthly payment on their credit card.
Delinquency rates are very high now pretty much across the board. They're probably higher than they were in the early 1990s. This is an extremely deflationary environment.
By
Joe Ferrazzano, at 9:52 PM
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