Turning inflation into wealth

freebo_2

I origionally put this on the mortgage forum, someone suggested it may be of interest here...

This was posted on the fool, thought I'd share it here. Of course all the govt talk at the moment is for deflation, but there are powerful reasons to beleive we'll see big inflation in the not too distant future.

I thought it was an interesting article and expresses a view which is contrary to what's commonly taught, I'm not suggesting anyone act on it without a lot of research...

http://the-great-retirement-experime...ding%20One.pdf

Mini_Bear

Good article freebo, definately opened my eyes up to the potentially devastating effects of inflation at retirement. Precious metals and income generating property it is then!

StevieJ

But surely stocks and shares would also constitute hard assets in an inflationary environment, so all financial assets are not the same.

purch

Where does Scott get the money from to repay Peter his 'devalued' currency after their retirement , and what Interest Rate does Peter charge Scott ??

That might alter the sums a little !!!!

And what if the Jap's and their mates don't stop buying Treasuries, and the $$ doesn't drop by 90%.............what happens then ?

Does Scott go bankrupt cos he can't afford to repay and then Peter doesn't get any money back....under those circumstances he'd be better off under the first scenario, cos at least he'll get something back, even if it is devalued !!!

Why don't the 'doomsters' ever think things through properly ???.............half a doom and gloom story is worthless !!!!

mizzbiz

purch wrote: »

Where does Scott get the money from to repay Peter his 'devalued' currency after their retirement , and what Interest Rate does Peter charge Scott ??

That might alter the sums a little !!!!

And what if the Jap's and their mates don't stop buying Treasuries, and the $$ doesn't drop by 90%.............what happens then ?

Does Scott go bankrupt cos he can't afford to repay and then Peter doesn't get any money back....under those circumstances he'd be better off under the first scenario, cos at least he'll get something back, even if it is devalued !!!

Why don't the 'doomsters' ever think things through properly ???.............half a doom and gloom story is worthless !!!!

Quote from the article: " but this is a short play and an illustration, not an Econometric model"

purch

" but this is a short play and an illustration, not an Econometric model"

Ah well.................then I guess it's totally useless and bears absolutley no resembence to reality then !!! :T

Just the sort of stuff that get's the doomsters all excited and aerated :eek:

mizzbiz

purch wrote: »

Ah well.................then I guess it's totally useless and bears absolutley no resembence to reality then !!! :T

Just the sort of stuff that get's the doomsters all excited and aerated :eek:

If you're not interested in an illustrative account of how inflation works (an in that, my friend, the illustration is spot on!), then why are you posting? What are you contributing to this except malice and ignorance?

"doomsters" - what a pratt. Posters like you are the reason I spend hardly any time at all on here now, very boring.

purch

the illustration is spot on

No it's not.....it has more flaws in it than even your pathetic signature. (where's the danger of arguing on an internet forum ??)

You may be perfectly happy to accept inaccurate drivel posted as fact without question, but some people do have IQ's higher than 10.

StevieJ

mizzbiz wrote: »

If you're not interested in an illustrative account of how inflation works (an in that, my friend, the illustration is spot on!), then why are you posting? What are you contributing to this except malice and ignorance?

"doomsters" - what a pratt. Posters like you are the reason I spend hardly any time at all on here now, very boring.

The article says that stocks and shares are a loser in a high inflation environment, where as stocks and shares are a good hedge against inflation , some illustration :eek:

JayScottGreenspan

In summary, if you put all your retirement fund in cash and get an interest rate below the rate of inflation, you're stuffed.

mizzbiz

purch wrote: »

but some people do have IQ's higher than 10.

Some, yes.....

The only thing I like about you is your quote from Voltaire, but then, from your previous posts, I don't think you even undertsand what it means :rotfl: