[mattduke]

I remember years ago, back while the fed was still inflating the housing bubble, debating whether it would be an inflationary or deflationary collapse. The investment thesis remains the same: first the housing bubble, then the crash, then the fed's inflationary response, and then the collapse of the dollar. I have invested my family's life savings 100% on this thesis.

[eastbay]

$this->bbcode_second_pass_quote('mattduke', 'I') remember years ago, back while the fed was still inflating the housing bubble, debating whether it would be an inflationary or deflationary collapse. The investment thesis remains the same: first the housing bubble, then the crash, then the fed's inflationary response, and then the collapse of the dollar. I have invested my family's life savings 100% on this thesis.

[chenopodium]

Same here . Land, solar passive house, solar panels, garden, no cash (no retirerment funds either
Cheno

[sittinguy]

me to,,,a good amount of food, propane goodies, a little metals. I would only be good for 1 year at the extreem most. This mild obsession, or faith in what i think will happen has created a little tension for my wife. She voted for Obama, (not me) and since the doom o meter is running low in her book (not mine!), she sees my efforts as a waste. I just filled an order from Be Prepared. It should be here soon, when she found out,, she started talking (threatening) me with new furniture.

I still believe this is a false rally. I see deflation ONLY in housing and investments, and by housing I mean Equity in houses. people with savings of some form are getting screwed. I really really don't care what my home value goes to! The day I pay it off is the day it becomes worth ZERO.

Inflation is what I see in plain view now, sneaking in through the cracks in gold:) and oil.
nobody wants the 10year, so they offer the 7year
false flag could used at the drop of a hat,, North Korea
Dollar falling
fed buying treasuries
gas almost $2.50
unemployment
foreclosures about to get fast tracking
alright i'm done,

[patience]

I'm with you folks. It took me a while to figure out a plan, being lost in the inflation/deflation debate for way too long. So, I decided to go for whatever would work in EITHER case, going for stuff that would produce for our own needs, like you all, gardens, energy, etc..

I did see the possibility of a whipsaw effect, of first one 'flation, then the other, which worried me for a long time until I gained some confidence in which would come first. (I'm not much on economics.) Once it became obvious, even to ME, that deflation was first, but not all, I could do some things. This site and Tickerforum have been invaluable help in saving my butt! When you don't have expertise in a given area, the rule is to find people who DO have it, and it worked for us. We started bailing on the paper investments a couple years ago, and have largely put it into the things mentioned in this thread. We didn't have much to start with, but the right moves sure helped, preserving our savings.

Lately, I have read that we might be in for another round of rising commodity prices from speculation, as caused oil to go so high. If that be true, then this seems to be the time to finish laying in commodity supplies, like stored feed grains (sealed in barrels with inert gas), some fencing materials, electrical wire, and some spare lumber for repairs. I can see the possibility of some shortages coming up, and hauling it home won't get any cheaper, either.

What scares me is this. We are too dependent on SS. Price increases (whatever you want to call that) continue to erode what cushion of cash we have on hand. My only hedge against that is to keep the repair shop open, but that business also dries up when things get tight enough. It has already slowed dramatically. If SS goes toes up, or inflates away (my thesis), then we are in deep doo doo. We will need all the benefits of our hedges, and it won't be enough.

[Tyler_JC]

There is deflation of stuff we own (stock, housing, bonds) and inflation of the stuff we buy (food, gasoline, etc.)

Plan accordingly.

[Golgo13]

Tyler nailed it.

Asset deflation, rampant monetary inflation.

[Cloud9]

Property taxes are the great fear. As governments squeez that last producers, we all may become dispossed.

[evilgenius]

How are you going to have inflation when nobody has any money? Do you think that the 'shadow' world will come into your local economies and spend in order to drive prices up? They are about consumed trying to keep the banks merely floating. As far as inflation goes I would be worried about what can't be replaced by local goods.

There is going to be a real tell over the next year as we see if the money pumped into the banks has allowed for enough car loans to be made. If we don't reach a certain level the economics of what is happening now with the carmakers won't work. That would be bad news for all industrial models that intend to sell their products anywhere other than dollar stores.

The pressure is down for wages and also for employment. The average starting wage at an automaker is about to go from $28 an hour to $14 an hour. How long before we hear of the reconstituted GM and Chrysler asking for workers to go down to $12.50, or even $10? That situation is being mirrored everywhere in the economy and in some cases the jobs, therefore the wages, have gone away.

All the same oil is running out. The situation has been made worse by the lack of investment in production over the past year and more. If the world were to come online again economically there is reason to doubt that the production system could keep up. If it comes to that and the West wants a semblance of what they have always had they will have to outbid the rest of the world for at least diesel and consequently gasoline as well.

Gold is going up no matter what I say. Keep in mind, however, that gold would have to go to something in excess of $100,000 an ounce for it to rival what a good stock can do in a ten year period of time. Do you guys think that gold will hit $100,000 an ounce in ten years? Compared to even Citibank gold is a poor choice. Most of you people talk about it as it if it gave you some kind of return when all that it has done is that it has reached a higher market price. To see that gain you would have to sell. Citibank has more than tripled from its 52 week low and at least it has given back a penny a share in dividends. Gold would have to be at over $2,000 an ounce right now to begin to match that. Gold has no dividends.

All the same the US could go bust. Yes, that is the trump card. If the US goes bust everything I just said amounts to nothing. Dollars would be worthless. Gold would be helpful. Knowledge would be king.

[truecougarblue]

Re: Citibank vs. Gold

Citibank is insolvent and will remain so. Gold is.

[evilgenius]

What kind of a statement is that, gold is while Citibank is insolvent and will remain so? I don't know where you are coming from. The fact is that Citi has gone up more than gold in the recent year. In both cases you can take your investment to market and exchange it for dollars. You could address how I assume an arbitrary entry point for Citi, but to say something like that is ridiculous.

[chenopodium]

I guess Citibank could become worthless, while gold will probably always have some value...

[evilgenius]

That's more like it. I was hoping somebody would say that. Of course, here is where I have to point out that the value that gold holds could be less tomorrow than it is today. Now it isn't likely to, but when I read comments like, I've put everything into the hyperinflation hypothesis, man, that could be a harsh ride.

[patience]

I guess I was making a post when the threads were merged--got a notice that the thread I posted to does not exist......

Before we get a lot of confusion going, we need to agree on the definitions of inflation and deflation. Austrian economics says they are simply an increase or decrease of the money supply, respectively. Most people perceive price changes as as one or the other. Make clear whether you are talking about money supply or prices, and save some misunderstanding.

Money supply is falling, since credit is less available. That is deflation. The dotgov is trying its' best to fight that with increasing mostly (all?) digital money, while prices are varying for all sorts of reasons, depending on the item and it's situation. It took me a year of wading through lots of semi-informed debates on the 'flation thing to get that sorted out.

Okay, my tuppence. As you were--continue.

[kerry]

Ok, I'm worried about some of you folks. Though it is good to prepare with hard assets, and to invest in things like solar panels and stored food, now, before they either become less available, or more expensive, for either inflation or deflation, the other things you must do to prepare for deflation differ greatly from preparing for inflation. And gold, well, you can't eat it.

Deflation is happening. The momentum is too big to fight by the central banks right now. It's happening in the definition of price deflation in wages, rents, and real estate, stock markets (well, after this sucker's rally is over, anyway) and the evaporation of credit, which was never real money, anyway. Luckily (I guess) it's happening globally, so we won't have to sell off our midwestern farm land to Europe and Asia, for now.

The debt we've promised and incurred going forward is incomprehensible to most people. There is simply no nation or group of people to buy it. Default on bonds is coming. Monetization by central banks isn't the answer. Tax revenues are evaporating. Retail is in deep trouble, as 70% of the Am. economy. Continuing jobs claims are still going up. GDP report is terrible. All of the tactics used by our government/treasury/fed so far have created some false illusions of propping up house prices and making the large banks appear solvent. The earnings of our children have been promised to the banking sector, which produces no real goods. Over 1 quadrillion in derivatives globally is out there. Many countries have serious debt problems--Eastern Europe, the UK, Spain, Ireland, US, Austria, Russia, Japan. All are intertwined causing huge repercussions when some aspect fails.

Have enough cash to live off of for at least a few months and try to become self sufficient. Get out of debt! Produce a good of use to your locality. And study your bank. Invest only in short term treasuries (for now). The regional banks are about to be slaughtered by the commercial real estate lending problems. The FDIC is falling behind, is understaffed and underfunded to respond when the dominoes start to fall, probably later this year.
K
Financial News Express
http://financialnewsexpress.blogspot.com/

[patience]

kerry,

Two thumbs up!

Either done, or am doing all that, except we dumped ALL the paper investments last year. Got a little silver coming my way, and noticed that it hit $15.76 bid today. Looks like somebody doesn't like fiat now. Biflation, here we come?

edit: I might add that it's a plus if your neighbors are self sufficient, too.

[wisconsin_cur]

And some of us are just trying to thread the needle... dependant on some things bound to go up in price, stuck doing work that is already paying less and, despite some good effort still stuck with too much debt. I have plenty of hedges in place against price swings but I do not expect to "win" or outrun the bear.

My hope is to outrun enough of the general population that the bear is no longer hungry when he gets to me. To extend the metaphor, I will "get mauled" but I should be able to keep "my life."

Each of us can only do what we can do.

[truecougarblue]

Re: Citibank insolvent

Take a look at the leveraged position they are in, if you think the loan defaults are over I've got a bridge to sell you. C is going the way of Lehman, Wamu and Indymac. It's only a matter of time.

Gold is, it's value is in it's nature. If you don't understand that then there is no convincing you it can be an effective hedge against dollar devaluation whilst presenting low risk from deflation.

The comparison of the last 6 months between the two means nothing. I could just as easily say we should go back 3 years, or five, to do the comparison. How about we do best 3 out of last five and see which wins?

[AlexdeLarge]

KD is banging the doomer drum louder than ever. (Complete with video and pretty charts.)

WARNING: Deflationary Collapse Dead Ahead
http://market-ticker.denninger.net/archives/1439-WARNING-Deflationary-Collapse-Dead-Ahead.html

$this->bbcode_second_pass_quote('', 'T')he fact of the matter is that you have been lied to for the last decade about our economic state, and if we do not divert from the road we are on our economy, our monetary system and our government WILL COLLAPSE.

Not "might collapse."

Not "might get bad."

WILL COLLAPSE.

It is a mathematical certainty, and here is the proof.

[vision-master]

Then what?



So much for old Glory on mainstreet.