If The U.S. Is Printing Massive Amounts of Money...
- Thread starter ByLoSellHi
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I'm shorting the 30-year treasury bond, but if the market has another big fall, there's a chance it'll spike again (good shorting opportunity!) so don't leverage so much you can't handle swings in it.
You could invest in other currencies, but you've got to be aware that they're going to be inflating, too, and the currency market right now is partly about trust, de-leveraging, and hoarding/redeeming. The yen is holding up well right now, but it follows our market somewhat, if you see a short-lived rally that's a good buying opportunity there.
Commodities might be a good hedge, but make sure they are ones that are essential to living. Like grains. Oil isn't really essential to living, so it's not necessarily going to sky-rocket right away.
Gold could be a good play, but be aware that it's at least partly a fear play. People don't really need gold, they need food and such.
You could buy some farmland and what you need to grow your family's food. I don't know much about whether the farmland will go up or down, but having the ability to grow your own food is always a good asset, IMO. My extended family owns some land, we're going to buy them some greenhouses with the ability to be heated (I'm hoping to find some with a wood stove attachment) soon so we can grow food even in the winter.
I'm not an expert, I've just been looking at this a lot lately. I'd love other ideas, too. All of these things are going to be long-term, too, so don't leverage so much you can't tolerate swings in any of them.
Come around to the eventual hyperinflation point of view now? If so, that's good, I'm in good company.Once the economy recovers and all that money comes out from hibernation, is when New Deal Inflation starts.
Thats assuming the Fed hasn't "mopped up" all that excess liquidity with high rates.
Money supply should expand commensurate with growth expectations. Otherwise, inflation results.
That 2 to 5 trillion bailout printed during economic contraction will find its way into circulation once banks - who have all the money - start spending again.
Then, we'll see 4$ bread, 6$ gas ect.
Jim Rogers is right again:
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Nice post.
The Fed, Treasury and G7 are in a desperate battle with DEFLATION.
Velocity of money is slowing. Financial company's Balance sheets have collapsed.
They knew this would happen years in advance. They picked Bernanke (specialist in The Great Depression).
OTOH, even if there is deflation it doesn't seem the recession/depression will be as bad as the 1930's unless there's some dislocation due to oil/the Middle East/war.
Velocity of money is slowing. Financial company's Balance sheets have collapsed.
They knew this would happen years in advance. They picked Bernanke (specialist in The Great Depression).
OTOH, even if there is deflation it doesn't seem the recession/depression will be as bad as the 1930's unless there's some dislocation due to oil/the Middle East/war.
Agree, deflation is the battle.
Private credit defaults (contraction) overcoming goverment monetary stimulus. Fractional reserve banking is running in reverse.
Everyone allways assumes hyperinflation must be the only way out of debt. No one considers that default is also an option, and perhaps the most expedient one.
It was designed to be too big to fix, or hyperinflate out of.
Goverment fixes now ensure quicker default.
Private credit defaults (contraction) overcoming goverment monetary stimulus. Fractional reserve banking is running in reverse.
Everyone allways assumes hyperinflation must be the only way out of debt. No one considers that default is also an option, and perhaps the most expedient one.
It was designed to be too big to fix, or hyperinflate out of.
Goverment fixes now ensure quicker default.
agreed. bond default triggers flight from currency, which is hyperinflationary.
And printing more money to satisfy past due debts in a self reinforcing spiral is also hyperinflationary.
The end will be the same. The question is when... this year or 50 years? I propose somewhere in between unless by some miracle we manage to create practical nuclear fusion power to satisfy unlimited energy, food, etc needs. Then the resource burdens that weigh our budgets would disappear (and associated military spending that would be unnecessary) and we'd march towards economic prosperity. But of course, that would be our ticket to hyperpopulation, which may not be so desirable (unintended consequence of free energy, having to share your space?)