Hyper inflation

I think hyper inflation here will be when OPEC and China don't want more dollars.

Interest rates will rise, Oil goes to $200/bbl, Gold to $2000/oz, Gas to $10.00, bread to $3.00, milk $5.00, but wages stay low because global competition prevents anyone from being able to make anything here profitably.

Stagflation to the max.
 
What form do you own gold? When people say they buy "gold" I have never understood exactly what that means....

Coins, gold bullion, gold company shares, ????

Two experiments:

Go to a jeweler and see what he pays for gold, and in what form he buys it....

Take your gold to your local bank and ask to exchange it for some dollars....

Hell, have some fun, go to the local grocery store, fill up the basket and hand the clerk a few gold coins......should be good for a laugh....

And, yes gold has been around for barter for 2000 years, but those days are long gone, boys and girls.....

Whale oil and coal oil were also popular but we now have electricity.....

I would say gold lost it's luster when the richest man in Saudi Arabia bought into APPL, McDonalds and a huge investment in Citibank.....the rest of the world has become more sophisticated and moves money electronically....

The US Dollar is the world currency.....accepted anywhere, any time,......one would be very naieve to believe otherwise....

Just as English is the business language of the world....

Other currencies are important, other languages are important but they play a supporting role to the US ......

As more countries began to "hoard" their oil I think oil will rise over the next several years.....not by too much, as that encourages alternative methods...

US oil companies only control about 15-20% of supply.....balance held by country controlled oil companies, Aramco, Pemex etc etc...

All very inefficient so they need US expertise to find, develop, and monetize the resources....

That is why WFT, HAL etc etc should be good buys for the future....


SteveD
 
The others will nationalize their resources or increase exploitation taxes as prices rise. The trend has occurred before and will occur again.

What is the oldest surviving paper currency, and what is its current value in relation to its value when it was first issued?

At first they decline slowly, but as time passes and more and more is printed, the value declines more rapidly. Find any historic paper currency for which that didn't happen. In the end they all have failed.
 
Quote from SteveD:

What form do you own gold? When people say they buy "gold" I have never understood exactly what that means....

Coins, gold bullion, gold company shares, ????

Two experiments:

Go to a jeweler and see what he pays for gold, and in what form he buys it....

Take your gold to your local bank and ask to exchange it for some dollars....

Hell, have some fun, go to the local grocery store, fill up the basket and hand the clerk a few gold coins......should be good for a laugh....


SteveD
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Hey Steve,

If I was working at the bank or the grocery store, I'd be reaching into my own pocket to pull out paper to put in the register so I could keep your gold. There is a

Go onto e-bay and buy bulk gold coins, like the $5 gold pieces, but bid on the real common dates and in low grade. If you win the auction, it will likely be because you paid $1 more than the next guy would have done. On any given night, you could probably even sell it on E-bay for more than you bought it for...of course you'd have to pay fees, which is cool with me since I own E-Bay stock. :)


But as for me. I like borrowing dollars, buying property which holds its value, and then paying the banker back in dollars that are ever decreasing in purchasing power. If they decrease in purchasing power faster than the banks thought they would, then I win.

SM
 
But that no longer matters because its so easy for us to convert to other currencies electronically now.

Think the US dollar is doomed? Fine, convert to euros, and hedge by shorting the US dollar.



Quote from thriftybob:

The others will nationalize their resources or increase exploitation taxes as prices rise. The trend has occurred before and will occur again.

What is the oldest surviving paper currency, and what is its current value in relation to its value when it was first issued?

At first they decline slowly, but as time passes and more and more is printed, the value declines more rapidly. Find any historic paper currency for which that didn't happen. In the end they all have failed.
More...
 
There's a pretty good thread somewhere around here by Gold Trader. He's making a good go of it. Gold seems to be about as silly as any other futures trading...

Gold stocks seem to be about as silly as any other stock sector...

The real kicker about your post, though...you implying that Iran is importing gas because they don't have oil in the ground. Two different things. They are an oil exporting country. They don't have the refining to keep up with their gas demands.

In short, you, sir, are lying, which isn't that bad of a thing, but do you have to use so many exclamation points when you do it?!!

Quote from SteveD:

Gold is a silly suckers game that ended in the 80"s.....


You guys live in a pretend delusional world if you think EVERYONE doesn't take US Dollars......

Foreigners KNOW that if they buy 500 million worth of 90 day T bills......they will get 500 million back in 90 days, if they so desire

Few, if any, other countries offer that safety......


What do you think would happen to the Middle East, if or when, oil goes back to $35/40 a bbl???? Basic math tells you their income is cut in half......big argument about exactly how much oil they have left in ground....Iran IMPORTS 40% of their gasoline!!!

Take some third world South American dollars????....wake up Monday morning.....coup over weekend.....all banks closed till further notice.....reverse split......you get 50% of your funds back....thank you for your business, LOL


Mr. Greenspan will be relieved that there is a poster on ET that understands monetary matters more than he does, LOL.


Guys, most people simply do not understand how large our economy is.....it is huge beyond comprehension.....and very flexible and resilient.....


The economy will ebb and flow......but it is not going into a 1929 depression, LOL.....


SteveD
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Quote from thriftybob:



What is the oldest surviving paper currency, and what is its current value in relation to its value when it was first issued?
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The Pound Sterling?
 
Quote from eusdaiki:



Actually, I haven't found an economically sound reason why deflation is a bad thing in any scenario...
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Deflation in an economy with so much debt, such as the US, is bad. Deflation hurts borrowers, who'd need to repay debt with more expensive dollars. How many trillions in debt do Americans have? (businesses, individuals, governments) Deflation lasting more than a few years would likely cause a lot of bankruptcies, as people would be unable to pay off their debt.

You are thinking of deflation merely from the point of view of falling prices for milk and eggs. Deflation is more than just that
 
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