Friedman On Inflation, Hanke on Hyperinflation
jmski52
Posts: 22,850 ✭✭✭✭✭
From Zerohedge - makes sense to me:
In hyperinflations, the “printing presses” go into overdrive because governments spend, and all the sources for funding their largess either never existed or wither away, except one: central banks. To set the stage, in a pre-hyperinflation situation, when a full array of financing options are available, government expenditures can be financed by taxes, by the domestic and international bond markets, by revenue from state-owned enterprises, and by central banks. In addition, governments can defer payments by accumulating arrears. So, arrears are also a means of “funding.” Governments can also go hat-in-hand to obtain foreign aid, yet another source of funding.
https://zerohedge.com/news/2018-08-27/friedman-inflation-hanke-hyperinflation
For those of you who are gullible enough to believe ZH to be a Russian-based conspiracy site, "This piece was originally published on Forbes.com".
I knew it would happen.
Comments
Your link doesnt work, but no matter as the first sentence you cite is fundamentally incorrect.
For the gullible. Theres a lot more, but why waste your time?
Knowledge is the enemy of fear
It's valuable, to me at least to form one's own opinions based on personal experience. Everyone has an opinion. Mine is based on experience and not on what I'm told, regardless of the source. I'd advise anyone to take a similar approach.
I knew it would happen.
Some folk just have more experience.
Knowledge is the enemy of fear
Link fixed.
It's interesting what they are uncovering in all of the Russian-linked players during the investigation into the Christopher Steele-produced dossier, no? But don't let facts get in the way. Turns out that the worst players in the whole scenario are/were swamp-dwellers. Gosh, that doesn't fit the "mainstream media's" narrative. Shocking! Then again, hardly anything truthful does.
No comments on the article itself?
Hanke, Johns Hopkins U. - referencing Milton Friedman from 1966 - a Russian conspiracy, no doubt.
I knew it would happen.
Russia Russia Russia !!!! Are they coming by land or by sea? Never mind they are already here hiding under the beds!!!!!
Paid for by the committee to elect Hillary 2020 This time it really is her turn
And who vetted all those sites coho? You?
The committee to elect hillary 2020 No really its her turn
At telling others what to read, what to think. . .
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Said the pot. LOL
Knowledge is the enemy of fear
Sharing what one reads is not the same as telling them what not to read.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yup, the author is correct--Venezuela is the only country experiencing hyperinflation.
Are you expecting hyperinfltion in the USA?
Well, under communism, there were no “taxes” and no tax administrations for assessing and collecting taxes.
I wonder what the author thinks of the glorious tax reform and accelerated spending and deficit propagated by the President that has "an appreciation for working people", as you put it.
Knowledge is the enemy of fear
Did you Dr?
Knowledge is the enemy of fear
many facts begin as disregarded rumors. All sources are a starting point. Most proven conspiracies begin as crackpot theories.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Im just trying to help the less fortunate.
Because I know you l like cartoons...
Knowledge is the enemy of fear
I wonder what the author thinks of the glorious tax reform and accelerated spending and deficit propagated by the President that has "an appreciation for working people", as you put it.
I know what I think about the tax reform and accelerated spending & deficit propagated by the President. My thought is that it fits the sequence described in the article, regardless of who is President it is/was going to happen because of the debt. There's no easy way out, and "difficult way out" isn't part of the lexicon in DC.
Remember the brilliant statement, "we have to suspend the free market in order to save the free market". This is the brilliance that we are dealing with, all over DC.
I knew it would happen.
No. Your google-fu screen grab is not my sales pitch, not my job to sell it.
I think you are paraphrasing "we had to destroy the village in order to save it"
I think you are paraphrasing "we had to destroy the village in order to save it"
No, I'm referring to the statement GW Bush made just prior to the 2008 bailouts.
I just googled it.
"Bush: “I’ve abandoned free market principles to save the free market system.”
Pure brilliance for all to see.
I knew it would happen.
.
I knew it would happen.
So is the gist of your thread to say that hyperinflation is coming?
Knowledge is the enemy of fear
Russians, Russians, Russians. It amazes me.... Cheers, RickO
It's apparently important for life forns to have an "enemy", whether rival lions or baboons for leadership of group and access to mates, or crosstown or different state sports teams to root against, or even different countries, or the Other political party within a country. A little competition is probably good and healthy, but of course folks tend to get carried away and this leads, sadly, to hatred and violence, to prejudice and demonizing in many cases.
The US will work very hard to achieve relatively slow and steady inflation, and maintain moderately low interest rates. The predictions of hyperinflation here have so far been incorrect, every single time.
Liberty: Parent of Science & Industry
So is the gist of your thread to say that hyperinflation is coming?
If you read the article you might discover that other things happen before hyperinflation. The article makes sense to me.
The predictions of hyperinflation here have so far been incorrect, every single time.
Why not read the article and then offer an opinion on its contents? It has nothing to do with rival lions or baboons.
I knew it would happen.
The rival comment was about the Russians Russians Russians. Please cut n paste the Article here; I can't have seroheje in my web history, or the Overlords might think I'm a nutcase, and put me on a List
Liberty: Parent of Science & Industry
Oh...I know what it takes to create hyperinflation....and it will be quite difficult to attain in the US without massive death and destruction. You see that happening anytime soon?
Knowledge is the enemy of fear
Oh...I know what it takes to create hyperinflation....and it will be quite difficult to attain in the US without massive death and destruction. You see that happening anytime soon?
Why not read the article and then offer an opinion on its contents? It has nothing to do with massive death and destruction. Do you see that happening anytime soon?
I knew it would happen.
I'd love me some bit of hyperinflation! My salary quintuple in a year, i pay all my mortgages off so fast! I sell all my gold so fast and buy so much fun times every day!
Liberty: Parent of Science & Industry
Yeah, I read it. The author thinks too little income and too much spending leads to hyperinflation.
So you think Trump has made a huge mistake that will lead to hyperinflation because he has cut tax income and increased spending? From the article, ** "Politicians never take responsibility for creating hyperinflations. They always place the blame somewhere else"** You think this is why Trump is already finger pointing the Fed?
Knowledge is the enemy of fear
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I'd love me some bit of hyperinflation! My salary quintuple in a year, i pay all my mortgages off so fast! I sell all my gold so fast and buy so much fun times every day!
Hi Baley. Thanks for your input, incoherent as it may be.
So you think Trump has made a huge mistake that will lead to hyperinflation because he has cut tax income and increased spending?
No, I didn't say that, did I? Why don't you pay attention to what's being said? In my OP, I quoted the article, to wit:
"...in a pre-hyperinflation situation, when a full array of financing options are available, government expenditures can be financed by taxes, by the domestic and international bond markets, by revenue from state-owned enterprises, and by central banks. In addition, governments can defer payments by accumulating arrears. So, arrears are also a means of “funding.” Governments can also go hat-in-hand to obtain foreign aid, yet another source of funding."
From the article, ** "Politicians never take responsibility for creating hyperinflations. They always place the blame somewhere else"** You think this is why Trump is already finger pointing the Fed?
The reason Trump is finger pointing the Fed is because the Fed decided to change its policy with his new administration. That's pretty obvious. And of course, politicians are masters at misdirection and placing blame somewhere else. What else is new under the sun?
So, I agree with the article that we're in a bind, but I have no opinion on how or when we might expect hyperinflation.
It seems to me that all of the available financing options listed have been, and are being - used to delay the inevitable default. The fact that the privately-owned Fed syndicate can lodge itself so firmly as a middleman between the taxpayers and the treasury is as big a problem as the corruption in the political system.
Touche'
I knew it would happen.
Sorry, channeling some BOBGO BONGO. Meant to say, if one's debts are denominated in dollars, and his assets are in ounces and acres and square feet, and the income earned in use of skills and collecting rents and cashing capital gains, wouldn't hyperinflation move all the decimal places?
Say a house is worth $250k, and the family has a $200k mortgage, and the payment is say $1200/mo, and his job pays $5k a month and then hyperinflation hits, is his home now worth a million, and he now makes 20 thou a month, but his payment and payoff amount don't change. Good, right? His food and fuel costs quadruple too, but not his debt, same number of dollars owed, easier to pay off, yes?
Liberty: Parent of Science & Industry
But if his uncle has to borrow at hyper-inflated interest rates to continue paying the interest on his debt then his uncle is screwed. And if all of the uncle's family is contributing to the cost of his growing debt, then the family is also screwed. Good thing we aren't on the hook for our uncle's debt. LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Wai... wha? Isn't hyperinflation going to be On Purpose to solve the national debt problem? Now it's also gonna 'screw' us because of the debt? Which is it?
Maybe neither. Just slow steady regular non- hyper inflation that tends to help the disciplined mortgator over time if he resists refinancing and spending his equity on junk.
Liberty: Parent of Science & Industry
Ummm....the Fed started to raise rates in late 2015, before Trump even announced running for Pres. I'm not surprised that PM bugs do not see the blame game so clearly as they are deeply mired in it themselves. All they have done for the last decade is blame someone or something else for gold not going up fast enough or gold going down. Blaming accountants and the FED for stocks going up. The banking cabal, the Fed syndicate, the Bilderbergs (what happened to that nonsense anyway?). Blame, blame, blame. Sounds like snowflakes to me.
Grow a set and be personally responsible.
Knowledge is the enemy of fear
BTW---Baley couldnt have been more coherent. I wonder why so many companies and individuals took on super low interest debt and invested in productive assets?
Its a conspiracy, damn you!! A conspiracy!! LOL
Knowledge is the enemy of fear
jmski----what is the debt to GDP ratio for Venezuela?
Knowledge is the enemy of fear
Say a house is worth $250k, and the family has a $200k mortgage, and the payment is say $1200/mo, and his job pays $5k a month and then hyperinflation hits, is his home now worth a million, and he now makes 20 thou a month, but his payment and payoff amount don't change. Good, right? His food and fuel costs quadruple too, but not his debt, same number of dollars owed, easier to pay off, yes?
Suggested reading, "When Money Dies" by Adam Fergusson. Hyperinflation doesn't happen the way you'd like it to happen. Besides the factors listed in the ZH article, this book illustrates how other factors (plus the ones in the ZH article) interact in ways that neither you nor I would be able to predict. Politics, debt, banking, prices - they all interact, and people, being imperfect humans - even the most well-intentioned decision makers tend to miscalculate.
Your boss won't be giving you increases in step with the devaluations. If you're the boss, you won't be giving your employees raises in advance. And it's likely that the debt will be recalibrated by the taxing authorities faster than you are prepared for. You won't get to pay it off with cheaper dollars unless you manage to time the payoff just before the debt is recalibrated, which is unlikely. The recalibration might even be retroactive. You won't get away from the problem unless you have NO debt.
Blaming accountants and the FED for stocks going up. The banking cabal, the Fed syndicate, the Bilderbergs (what happened to that nonsense anyway?)
Blah, blah, blah - yeah, to hear you talk, there's never been insiders or a conspiracy involving money. God's work - that's what bankers do, I tell ya. Markets never get manipulated to the advantage of the manipulators as long as their buddies run the oversight agencies. Bankers love leverage because it always works as long as they can keep making more loans with fewer reserves and the taxpayers pay for all their loan mistakes and nobody gets prosecuted. Blah, blah, blah.
Muppets. Never forget.
I knew it would happen.
Most of those listed companies used low interest rates to buy back their stock. This has been much of the fuel in the record highs. And yes, higher rates, because of this, will affect the stock market.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
A criminal conspiracy exists when two or more people agree to commit almost any unlawful act, then take some action toward its completion. Of course this would never happen in financial markets or people would be going to jail. LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
On utube, find prof Bill Black at UMKC, who prosecuted thousands of banking malfeasants after the 1989 banking scandals.
Since then, except for Enron - the banking industry and Wall Street must've been "clean as a whistle" since there have been virtually no prosecutions from the 2008 fiascos and beyond. (not really)
If it's not a whole slew of criminal conspiracies, I'm not sure what the correct term would be.
Graham, Leach, Bliley was the biggest insider palm-greasing, back-scratching piece of legislation in our lifetimes, and that's saying something!!!
I knew it would happen.
Interview with Bill Black: The Great Global Bank Robbery, Part 1
Bill Black was the go to guy back in the days of holding banking officials responsible for their crimes. Now it is more profitable for the gov to just hit the institution with billions in fines and let the individuals keep thinking up new ways to have to pay more fines.
Sorta like the revolving door justice system that provides and endless stream of income for all those involved except, of course, the poor suckers.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well, if this is what it feels like to be a sucker getting screwed, it ain't so bad- stocks are up, real estate's up, metals are... oof, yeah, see what ya mean, we metals holders not so comparatively happy, are we?
Hey, seems like ole times again, huh fellas!
Liberty: Parent of Science & Industry
No, this is what it feels like to be a sucker who doesn't know he's being set up to get screwed. Enjoy!
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
didn't the medias latest hero saint john mccain get busted taking a bribe from charles keating in 89 ? I waited for someone to bring that up during the last weeks love fest but they never got to it
Knowledge is the enemy of fear
The title for your new autobiography?
Knowledge is the enemy of fear
we metals holders not so comparatively happy, are we?
Who's complaining? I've been buying more than I've been selling.
I knew it would happen.