How to make an inflation play?
- Thread starter kmiklas
- Start date
Why not short the longest tenor Treasuries you can get, the longer the tenor the more responsive to interest rate no?
Why, out of curiosity?
Inflation has been so thoroughly suppressed by globalized supply in North America. Buying option premium would be, IMO, ruinous as a pure inflation bet due to Theta decay.
And on a real estate reit etf of all things...
With rising US dollar against other currencies there is very little 'inflation' if you own USD in the last years. you were better off holding US dollars..
inflation is destruction of the purchasing power of fiat money. lots of inflation in Hong Kong and in China, and in middle east and many third world countries in south america. not much inflation in US hence less riots and unemployment.
deflation has never cause riots or social unrest.
infltaaion however has been the root cause of civil war, social unrest and riots. businesss cannot pass on higher prices and demand falls as wages has not gone up in par.
high inflation in middle east, south america, and in asia. either from incompetent central bankers or policy of inflation where owners of assets get rich while the masses see their fiat money fall in value
you think the US FED is a fraud operation? other countries it's openly obvious, ripping of the system or theft by the central bankers.
ten commands or laws of the land
thou SHALL NOT steal and not LIE
both will be punished by death.
inflation is destruction of the purchasing power of fiat money. lots of inflation in Hong Kong and in China, and in middle east and many third world countries in south america. not much inflation in US hence less riots and unemployment.
deflation has never cause riots or social unrest.
infltaaion however has been the root cause of civil war, social unrest and riots. businesss cannot pass on higher prices and demand falls as wages has not gone up in par.
high inflation in middle east, south america, and in asia. either from incompetent central bankers or policy of inflation where owners of assets get rich while the masses see their fiat money fall in value
you think the US FED is a fraud operation? other countries it's openly obvious, ripping of the system or theft by the central bankers.
ten commands or laws of the land
thou SHALL NOT steal and not LIE
both will be punished by death.
Um, the Great Depression sure was a swell time. Also happens to be the last time we had significant worldwide deflation. Maybe time to take that macro econ class over....or just plain take it?
there was no deflation in the great depression. companies went bankrupt and there was 'prices' of assets dropped especially the stock market. people were unemployed and so prices fell. unemployment in the US was 30-40% in the great depression. businesses went bankrrupt as consumer demand dried up and GDP went down. or GDP dropped 50% or more. prices didn't recover til 1945 or 10 years. in the long term prices rise due to inflation.
asset managers want inflation or banks want inflation or owners of assets. but for the 'economy' inflation does nothing for the economy. or GDP. or taxes. inflation is nuisance or something the gov't has to deal with. or face riots and strikes as people or workers get paid less or cannot afford things. inflation is like pay cut in salary. same as rising taxes.
workers go on strike if you cut their salary or income..that is what 'inflation' is or true inflation.
asset managers want inflation or banks want inflation or owners of assets. but for the 'economy' inflation does nothing for the economy. or GDP. or taxes. inflation is nuisance or something the gov't has to deal with. or face riots and strikes as people or workers get paid less or cannot afford things. inflation is like pay cut in salary. same as rising taxes.
workers go on strike if you cut their salary or income..that is what 'inflation' is or true inflation.
I think we have to agree up front that words that have well established definitions that have been in place for decades be used in the manner intended. We don't all get to decide our own definition of the word "deflation" in economics. And the definition is "reduction of the general level of prices in an economy." You just listed a bunch of instances of "reduction of the general level of prices in an economy." and then claimed it wasn't deflation....because there were reasons for it?
Again, when did you last take a macro class? If you haven't, as appears to be the case here, there's no shame in it. There are a ton of great MOOC courses that are free and taught by some of the best minds in economics around. Until you understand the basics of macro, you're unfortunately not even in possession of a common vocabulary to discuss this kind of thing let alone have the background to understand how the banking system works, what economies without banking systems or lending end up looking like, and what role inflation vs deflation plays into all of that. TLDR on the macro class....deflation is destructive for economies at every level. Full stop.