The end of cheap money is nearing, Uh-Oh, now what?????

Quote from drsteph:

Hallmarks of an economy driven on money pump is investment in non-economic assets because of a fear of devaluation of cash. Better to lose some than lose all is the thinking. Think we are there yet?

Moving out of bonds and cash into equities might be a sign, but its hardly widespread. And dependent on QE III - without that, deflation might, (not will, but might) raise its ugly head again.

June-Sep will be interesting, that's for sure.
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There will not be deflation. Only less inflation or more inflation. Assuming we are talking about the overall economy and not a particular sector.
 
Quote from piezoe:

There will not be deflation. Only less inflation or more inflation. Assuming we are talking about the overall economy and not a particular sector.
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not sure what you are basing it on, but if its rising prices you are dead wrong. if the fed raised interest rates tomorrow to 1% silver would instantly drop $20. everything would gap limit down for a week.
 
Step 1: Predict the end of cheap money
Step 2: Establish a short position in bonds
Step 3: Be right
Step 4: Profit
 
I completely agree! Everyone seems to believe that the economy is turning around but nobody actually understands either what happened in 2008 or what is happening now.


I read an article the other day that said when a great power begins to spend more on the interest from its national debt than on its defence, things go to the toilet. It happened to Rome and it happened to Babylon. Nobody, including me, wants to face it but the US is getting pretty close to that turning point.
 
What if things were slightly different:

What if we were spending our debt on money... instead of spending our money on debt.... When you filp those words around you should immediately so that money is debt. As long as money is debt.. well, money will be around...

Might want to read Warren Mosler, Bernard Lietaer, Charles Hugh Smith for a journey to the other side.
 
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