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Nassim Taleb makes big bet on inflation
- Thread starter turkeyneck
- Start date
Quote from ulla:
Surely hyperinflation and stagflation would be the same sort of trade, long gold and silver and commodities??
Considerable or even relatively high inflation doesnt guarantee commodity performance I would think.
Hyperinflation is a different story ofcourse.
But simply high inflation can present itself in the stockmarket, wages, real estate or commodities or a few of them combined at the same time or not.
It's about peoples expectations I guess and the suply demand dynamics.
As often said people have been predicting precious metals to go to the moon for decades now who is to say this is it for real?
Good luck.
Quote from ang_99:
like most trades that seem too obvious...
KABOOOOOM!
Meanwhile, gold and silver are holding close to all-time highs. And have been, for over a year. Gold will break 1000$, within days...
Traders said the same thing about the T-Bill short trade, earlier this year. "Too obvious", they said.
Let's see. Up 48% since Dec '08:
http://ca.finance.yahoo.com/q/bc?s=TBT&t=1y&l=off&z=m&q=l&c=
Why has economic forecasting become 'easier'? Keynesian economics is a fraud that papers over and obscures many fundamental truths laid bare by the Austrian School. The Austrian School has enjoyed a huge resurgence in popularity amongst hobbyists, pundits and pro's. Its offers much deeper insight into money supply, creation, Central Banks, fractional lending, velocity and its relationship to GDP, inflation and deflation.
Critical to understanding macro-trends.
To be fair, the above is IMO so far mostly true for bloggers, college kids and youtube surfers. But that doesn't mean that can't change.Quote from achilles28: The Austrian School has enjoyed a huge resurgence in popularity amongst hobbyists, pundits and pro's.
Once the goldbug virus actually catches on with the consensus of "smart money" and institutional investors (a la 1980) get ready for the final blowoff top in the commodity/hyperinflation/world is coming to an end trade.
For me, George Soros has shed some helpful insight into how we arrived at this point, this credit bubble. His theory of Reflexivity makes a lot of sense, markets don't always tend towards equilibrium and don't accurately discount all information. Markets develop collective biases, just as we do individually. Yet economics approaches the markets as if they can be predicted with scientific certainty, and when they cannot. I wonder if his boom-bust model has any parallels with the Austrian School??
Quote from makloda:
To be fair, the above is IMO so far mostly true for bloggers, college kids and youtube surfers. But that doesn't mean that can't change.
Once the goldbug virus actually catches on with the consensus of "smart money" and institutional investors (a la 1980) get ready for the final blowoff top in the commodity/hyperinflation/world is coming to an end trade.
One key difference from late 70's, early 80's: deeply indebted nation.
Quote from peilthetraveler:
No doubt it will be quicker and worse than germany since so many more people are going to exacerbate it than they did in germany (yeah there were traders back then betting on hyperinflation too!)
No it's not. I suggest you actually research the situation to understand why Germany's hyperinflation was so drastic.
USA's hyperinflation will be more controlled and may never even take full course as a global currency will be instituted. It will be similar to Argentina.
Quote from Mecro:
No it's not. I suggest you actually research the situation to understand why Germany's hyperinflation was so drastic.
USA's hyperinflation will be more controlled and may never even take full course as a global currency will be instituted. It will be similar to Argentina.
Folks should pay attention to this statement.
Quote from makloda:
To be fair, the above is IMO so far mostly true for bloggers, college kids and youtube surfers. But that doesn't mean that can't change.
Once the goldbug virus actually catches on with the consensus of "smart money" and institutional investors (a la 1980) get ready for the final blowoff top in the commodity/hyperinflation/world is coming to an end trade.
Ron Paul, Peter Schiff, Jim Rogers, Marc Faber. Not quite the standard fair of college geeks and youtubers.
That said, when the institutional blow-off top peaks in gold (if), what will that portend for domestic inflation and prices?
I sincerely doubt gold and silver - at these levels, for 18+ months - is a knee-jerk reaction to sound fundamentals and a normal recovery.
Base money supply has doubled since 2006 (when inflation was red hot). Thats total reserves depository institutions have to leverage out against loans, by fractional lending.
http://research.stlouisfed.org/fred2/series/BOGAMBNS?cid=124
Once banks end the derivative charade and resume easy credit, M3 goes nuts and we get big inflation. It all depends on the multiplier or private borrowing. When that happen, its on.
The Feds record at mitigating crisis - no less, precipitating them - isn't reassuring. Also consider their private ownership structure and regulatory actions not taken or recommended to stem the current crisis, and its a lock our friend Bernacke is a puppet for the Banksters.