Where's the inflation? US CPI unexpectedly drops 0.1%

[misterno]

my god there are so many ýdýots ýn thýs thread ýt ýs just amazýng

don't you guys see even today usd ýs up and all other currencýes down. ýsn't thýs tellýng you somethýng?

travel the world and open up your mýnd

nothýng can beat the usd nor amerýca

amerýca ýs no roman empýre we are a world empýre

 

[Kassz007]

Quote from misterno:

my god there are so many ýdýots ýn thýs thread ýt ýs just amazýng

don't you guys see even today usd ýs up and all other currencýes down. ýsn't thýs tellýng you somethýng?

travel the world and open up your mýnd

nothýng can beat the usd nor amerýca

amerýca ýs no roman empýre we are a world empýre

You are the one who is delusional. Get a new keyboard too, your shit doesn't make sense.

 

[achilles28]

Quote from Kassz007:

I agree completely regarding the payback of USA debt. USA NEEDS inflation. Which is the reason for all of the printing. My complaint is with people who bitch about the Fed printing because it will bring inflation. Some would rather see deflation, which would be the end. Default city.

That being said, I do believe that hyperinflation is NOT inevitable, and that central banks will be able to combat it. If I played the crystal ball game like many others, I would predict moderate inflation is where we're headed. The article I posted clearly demonstrates that inflation is not here yet. It was meant as a counter argument to those on here who try to argue that inflation is already here and running rampant.

The absolute size of debt combined with it's short-dated maturity translates to unmanagable interest payments even with modest hikes.

At 6% rates, interest on the national debt would approach 1 Trillion a year.

Sure we can pay it, if social security, medicare, medicaid, defense and obamacare all take a 50% haircut.

America can't support it's current living standard nor can it make good on all the handouts and entitlement promises made over the decades.

You just mentioned the problems with severe deflation. Imagine the Government decided to honor those debt payments at 6% and cut the budget by 800 Billion (for interest) and another 1.4 Trillion in deficit spending (to balance the books). What happens then? Or do we just keep rates at 0% for the next 10 years to avoid blowback on the crushing national debt? What happens under that scenario?

There's no middle ground. As soon as rates are moderately lifted to combat inflation, debt service payments double or triple. This crowds out spending on existing programs and has major deflationary ramifications for the broader economy and GDP growth. This is exactly what's happening to Europe right now, commodities, and non-EU equity markets, as a proxy fallout. PIIGS are taking their medicine with drastic cuts, and markets are pricing in big deflation. The Central Banking wizards are trying to stave off a european collapse with IMF/German money. Basically, prop the weaker EU countries and their banks to prevent a run in America.