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Title: USD Facing deflation? Post by: XxionxX on February 22, 2013, 08:16:37 AM Counter to many peoples view on this forum and /r/bitcoin, I found a notable economist who thinks the usd will DEFLATE instead of inflate. Take a look at his impressive Wikipedia page (http://en.wikipedia.org/wiki/Gary_Shilling).
He has some great articles (http://www.bloomberg.com/view/bios/gary-shilling/) on the world economy and a fantastic 5 part series (http://www.bloomberg.com/news/2013-01-27/why-deleveraging-still-rules-markets-in-2013.html) on the mid-term market outlook. In the series he goes over 'risk on' and 'risk off' strategies for different types of investing outlooks. I also think he is very articulate in this interview on Bloomberg TV (http://www.bloomberg.com/video/76255786-gary-shilling-says-u-s-faces-deflation.html). Considering so many people are forecasting a total meltdown or totally ignoring the problems at hand, I find it refreshing to hear someone talk about both sides of the equation. The other topic on the collapse of the usd was popular and relevant, so I figured this might be worth discussion. I am going to bed, so this will be my last post for the evening. I want to wake up tomorrow to find that you guys have hit $32! :D P.S. I am still holding onto my silver, I don't trust the fedbank. I would rather hold deflating silver than an inflating usd. Title: Re: USD Facing deflation? Post by: xxjs on February 22, 2013, 05:07:29 PM Pressure to increase the value of the dollar:
1) Other currencies failing 2) Debt clearing due to perceived risk increase. I don't think it will be allowed go go on for long, though. Title: Re: USD Facing deflation? Post by: adamstgBit on February 22, 2013, 05:11:33 PM it just can't deflate...
if it starts to deflate they print more money in the name of "fighting deflation" Title: Re: USD Facing deflation? Post by: Vladimir on February 22, 2013, 05:13:32 PM One point of view is that defaults cause destruction of money supply and new supply cannot be created because nobody wants to take any loans even at negative interest rates. This would be deflation.
Another school of thought is do not fight the fed, instead relax and enjoy yourself. This would be inflation. Chances are, however, that there will be inflation and then deflation and then inflation again and so on until children wake up homeless on the continent their Fathers conquered (same for other continents too I suppose). Title: Re: USD Facing deflation? Post by: xxjs on February 22, 2013, 05:19:07 PM it just can't deflate... if it starts to deflate they print more money in the name of "fighting deflation" Exactly Title: Re: USD Facing deflation? Post by: cypherdoc on February 22, 2013, 05:36:11 PM One point of view is that defaults cause destruction of money supply and new supply cannot be created because nobody wants to take any loans even at negative interest rates. This would be deflation. Another school of thought is do not fight the fed, instead relax and enjoy yourself. This would be inflation. Chances are, however, that there will be inflation and then deflation and then inflation again and so on until children wake up homeless on the continent their Fathers conquered (same for other continents too I suppose). it's called Cycle Theory. ;D i talk alot about deflation and a rising USD in my newsletter. Title: Re: USD Facing deflation? Post by: cypherdoc on February 22, 2013, 05:37:40 PM it just can't deflate... if it starts to deflate they print more money in the name of "fighting deflation" Exactly don't be so sure. it might be true if $200/barrel oil or $10/gal gas is sustainable or if ppl can't afford food. |