The Inflationary Holocaust Happening Anytime Soon

wombat42_2

dunker1 wrote: »

lol, it really is most amusing how the sheep who bought into the commodity supercycle theory and who must be currently sitting on huge losses are clinging to any hope that a reversal is gonna happen. Jim Rogers has a following because he is outspoken and shouts louder than others, this will always get people on board to his philosphies, i should know as my brother was one of them and has been stung massively. Lets get this clear....we are in and gonna be in a massive global slowdown..this can only equal a far far lower demand for commodities...plain and simple fact.

Golman Sacks and many others support the commodity supercycle view.

You forget that Rogers has a lot of succesful predictions on his side. For example, he predicted back in March that things would get a lot worse later this year. He is an anti establishment figure. He is constantly invited for interview interview on the financial media - if his predictions didnt work out he would get far less attention. He has never said that commodities would go up in a straight line - far from it.

http://jimrogers-investments.blogspot.com/

http://en.wikipedia.org/wiki/Jim_Rogers

baby_boomer

It would be nice if wombat could edit the word "holocaust" out of the title.

I'd be grateful if he did.

wombat42_2

See the man himself speak

http://uk.youtube.com/watch?v=jJ4dNtbT_u8

innovate

wombat42 wrote: »

Golman Sacks and many others support the commodity supercycle view.

Think you might mean Goldman Sachs

ChiefGrasscutter

Jim Rogers seems to claim that in his solution those with debts go bankrupt and those with assets survive and we all just start again and carry on.

In practice such a 'mass bankruptcy solution' would have precisely the opposite effect.

Those with debts would effectively get their debts eliminated as there would be no one to collect the debt - or that it would simply be physically impossible to collect the debt - think of trying to collect the debt on all UK mortgages en mass all at once!
Meanwhile the savers and depositors would find that their assets no longer existed (most of them anyway) and they would be unable to retrieve them
(Think of it much like Icesave on a much bigger scale and with no deposit protection).

So while the debtors would walk away the savers would have been kebabed which is the precise opposite to what Jim Rogers is suggesting would happen: far from the debtors being eliminated - it is the savers who are.

At this point in the 'solution' some really major problems would start as many would say why should I work/earn money if all that happens is that it gets 'stolen': or if they did they would certainly not put it in a bank. This in turn means no lending would occur, no tax receipts for HMG etc.

You would rapidly get total and complete financial, monetary and fiscal breakdown - and that's before you start to consider the accompanying social breakdown that would occur.

Great in theory - not in practice.

tomstickland

baby_boomer wrote: »

It would be nice if wombat could edit the word "holocaust" out of the title.

I'd be grateful if he did.

From the author of this video

Please stop being offended.
The author called it a holocaust, implying a dreadful event.


Regarding inflation vs deflation, the argument I read from a well respected economist is that a lack of money supply (because the banks have stopped lending) will cause deflation.

Scrapper

After the 1929 stock market crash there were several years of deflation, despite low interest rates. In Japan, when the asset bubble burst, deflation followed despite near zero interest rates.

Commodity prices are falling: copper, etc. Shipping rates are falling. House prices are falling. This is deflation in those things.

The price of, say, iron ore has risen strongly in recent years as demand has outstripped supply. But there is no shortage of iron ore on earth, there has only been a shortage of iron ore mining capacity. Iron ore demand is slowing but mining capacity is rising. Result? Falling iron ore prices. Once world economic activity picks up again maybe demand will exceed mining capacity again. Maybe.

But there is a fundamental shortage of oil, so unless an alternatve is found its price will rise and rise. And arguably there is/will be a fundamental shortage of food too - world population is rising at a lemming-like pace.

If anyone here knows there will be hyper-inflation, back your "knowledge" and buy whatever will keep up with it (please let us know what you are buying!).

If anyone here knows there will be sustained deflation, back your "knowledge" and, what, bury all your tenners in your back garden and then dig it up when all the banks have gone bust and prices are way down?

Personally I have no idea if there will be significant deflation, significant inflation, both or neither. Wish I did.

tomstickland

Inflation would devalue my mortgage, which would be handy.

OOPS

Hyperinflation ? Deflation ? socialist bank buyups , printing cash to create more borrowing ? Its all a fairytale.

The uk prime minister and chancellor are BARKING MAD.I know what we will do , print more money , encourage MORE borrowing (like that will help a nation like the uk or us already unable to pay the debts which is the prime cause !)

I think the guys right - it should have been left to collapse ..........it will anyway , its odvious........people wont borrow , recession will come and it will get messy in the uk - very very messy and then anti terror laws will be used to govern and before we know it jesus will appear........

and then i woke up and realised it wasnt a dream

OOPS

Hyperinflation ? Deflation ? socialist bank buyups , printing cash to create more borrowing ? Its all a fairytale.

The uk prime minister and chancellor are BARKING MAD.I know what we will do , print more money , encourage MORE borrowing (like that will help a nation like the uk or us already unable to pay the debts which is the prime cause OF ALL THIS!)

I think the guys right - it should have been left to collapse ..........it will anyway , its odvious........people wont borrow , recession will come and it will get messy .Weve built an imaginary world of prosperity for many built on borrowing , the system feels if it can keep us 'borrowing ' it can survive .

That will not work longterm...........its odvious it wont.

Eventually we will all share - i cant wait .