Doesn't seem that concerned.
INFLATION--FED's cutting rates again...
- Thread starter Chop
- Start date
Doesn't seem that concerned.
Ray Dalio weighs in:
"So what it means-- and then there's a supply/demand picture for bonds. And the way it looks is if you should get the selling of bonds, it worsens that supply/demand picture because the way it works is the Treasury borrows and runs a deficit, but it can't produce money. So it has to sell bonds. And when it sells bonds, if there are not enough buyers of those bonds, then the Federal Reserve's got to come in and print money and buy those bonds.
And the world right now is overinvested in US dollar-denominated bonds, pension funds on the 60-40 mix, or-- and they have negative real returns. And cash has a lot of negative real returns. So if there was a selling of that and a moving to other assets-- stocks, other assets, commodities, other assets, or other places, other currencies, other real estate and the like-- that selling worsens the supply/demand picture. And then if there's not enough demand [for T-bills], that means that the central bank is going to come in and print more money. So yes, it's not only the inflation that's in the pipeline or projected in that supply/demand balance, but it's also what it could be if there's a selling of debt instruments."
Ray Dalio: I’m ‘significantly concerned’ about inflation
"So what it means-- and then there's a supply/demand picture for bonds. And the way it looks is if you should get the selling of bonds, it worsens that supply/demand picture because the way it works is the Treasury borrows and runs a deficit, but it can't produce money. So it has to sell bonds. And when it sells bonds, if there are not enough buyers of those bonds, then the Federal Reserve's got to come in and print money and buy those bonds.
And the world right now is overinvested in US dollar-denominated bonds, pension funds on the 60-40 mix, or-- and they have negative real returns. And cash has a lot of negative real returns. So if there was a selling of that and a moving to other assets-- stocks, other assets, commodities, other assets, or other places, other currencies, other real estate and the like-- that selling worsens the supply/demand picture. And then if there's not enough demand [for T-bills], that means that the central bank is going to come in and print more money. So yes, it's not only the inflation that's in the pipeline or projected in that supply/demand balance, but it's also what it could be if there's a selling of debt instruments."
Ray Dalio: I’m ‘significantly concerned’ about inflation
Dude knows what he's talking about. Highly successful hedge fund guys tend to gravitate towards large estates. This is Ray Dalio's house in Connecticut (no joke--he bought it about 5-6 or so years ago):
When the audio lead off is "The most extraordinary property in all of Greenwich..." you know you're dealing with a special mansion and property. $$$$$$$$$$ Good thing he grabbed it before all this inflation hit in...
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News from the Fed:
"The Federal Reserve concluded its December meeting Wednesday, announcing it will speed up the taper of its asset-purchase program. The Fed also indicated it sees as many as three rate hikes in 2022. "
There’s a risk that inflation may stay persistently high, Powell says
"Covid omicron variant ... does not impact the central bank’s plans to accelerate its tapering of pandemic-era aid."
Tom Garretson , senior fixed income strategist at RBC Wealth Management, said that the notion of three rate hikes in 2022 is a bit more hawkish than expected, “but it seems the market is OK with it. ” [indeed -- in part, because everyone saw rate hikes coming, and this is the news not the rumor ...]
https://www.cnbc.com/2021/12/15/fol...ed-decision-and-powells-press-conference.html
"The Federal Reserve concluded its December meeting Wednesday, announcing it will speed up the taper of its asset-purchase program. The Fed also indicated it sees as many as three rate hikes in 2022. "
There’s a risk that inflation may stay persistently high, Powell says
"Covid omicron variant ... does not impact the central bank’s plans to accelerate its tapering of pandemic-era aid."
Tom Garretson , senior fixed income strategist at RBC Wealth Management, said that the notion of three rate hikes in 2022 is a bit more hawkish than expected, “but it seems the market is OK with it. ” [indeed -- in part, because everyone saw rate hikes coming, and this is the news not the rumor ...]
https://www.cnbc.com/2021/12/15/fol...ed-decision-and-powells-press-conference.html
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Monahorns
10,000+ Posts
They rarely follow through with statements like this. Even then it is way to little.
The Bank of England bumps up UK interest rates by 0.25% to mitigate inflation.
Bank of England: UK interest rates hiked to 0.25% to combat surge in inflation – business live
AC
2,500+ Posts
Bank of England said Bitcoin is going to Zero.
Here is the chart on the Brittish Pound priced in Bitcoin:
You see if something is truly scarce, (only 2 million Bitcoin left to be produced from now until 2140), it eats every other asset. That is what Bitcoin is slowly doing. The world needs to wake up to this. The USD, the Euro, it's all going to zero. Not Bitcoin. Central Bank Digital Currencies like the IMF and WEF tout. Please, that is just a social credit system. Get the latest jab, you get to keep your money. Otherwise, they take it from you. Central Banks are culling us off the damn planet. Who funds the wars? Latest pandemic? Who owns the politicians? Who owns Fauci? PRIVATE CENTRAL BANKS. They print the money, reverse repo, stock buybacks, etc. Bond bubble created, it pops. They create false flags, destroy the economy. One world currency, and Bitcoin decentralized, out of the system. Which one are you choosing. CBDC or Bitcoin? That is your choice. You'll see!
Here is the chart on the Brittish Pound priced in Bitcoin:
You see if something is truly scarce, (only 2 million Bitcoin left to be produced from now until 2140), it eats every other asset. That is what Bitcoin is slowly doing. The world needs to wake up to this. The USD, the Euro, it's all going to zero. Not Bitcoin. Central Bank Digital Currencies like the IMF and WEF tout. Please, that is just a social credit system. Get the latest jab, you get to keep your money. Otherwise, they take it from you. Central Banks are culling us off the damn planet. Who funds the wars? Latest pandemic? Who owns the politicians? Who owns Fauci? PRIVATE CENTRAL BANKS. They print the money, reverse repo, stock buybacks, etc. Bond bubble created, it pops. They create false flags, destroy the economy. One world currency, and Bitcoin decentralized, out of the system. Which one are you choosing. CBDC or Bitcoin? That is your choice. You'll see!
I just got back from shopping at the Commissary - and I can confirm that inflation is still hitting hard on groceries. Fortunately (at least for my household) cat food prices are holding steady. 
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Damn I hate it when they put one key right next to another on a keyboard. You probably do too.I just got back from shopping at the Commissary - and I can confirm that inflation is still hitting hard on groceries. Fortunately (at least for my household) cat food proces are holding steady.
Statalyzer
10,000+ Posts
Isn't the biggest problem that it discourages investment and really screws over people trying to get out of debt, since interest rates only take into account the nominal dollar amounts, and thus you have to pay back a much bigger amount than you borrowed in terms of real purchasing power. Whereas, with inflation, you can invest more and pay down debts faster since you got to borrow better money than the money you are paying it back with?
Now, it's getting serious:
Protect Your Retirement with Chuck Norris’ Special Report
"Higher taxes, increasing National debt, increasing inflation - well, our dollar doesn't go as far as it used to."
Protect Your Retirement with Chuck Norris’ Special Report
"Higher taxes, increasing National debt, increasing inflation - well, our dollar doesn't go as far as it used to."
AC
2,500+ Posts
He lives in Navasota, or he used to. Nice guy, I’ve met him once. Gold is also an option. Much more conservative, but it’s a hedge too.Now, it's getting serious:
Protect Your Retirement with Chuck Norris’ Special Report
"Higher taxes, increasing National debt, increasing inflation - well, our dollar doesn't go as far as it used to."
Yes, that is the case against it, and I don't think it's totally BS. However, I think we've gone way too far the other direction. We're screwing savers and basically anyone whose investments aren't inflation-proof.
I understand why people buy Bitcoin, but if you think about it, it's pretty pathetic. People buy it because long term they don't trust the big global currencies not to inflate themselves into irrelevance. It shouldn't be that way.
It's a balancing act. The right balance, with just a tad of light inflation, is difficult to maintain. Amazingly, until the last couple of years, that's what we've had for about a decade. And the economy and markets did very well overall.
Energy is a big driver of many inflation spikes. It's what did Carter in. It's a big part of what is sinking Joe now. I would be significantly incentivizing drilling, transport (including without limitation pipelines), refining, and distribution. (or at least not thwarting it) But then again, I'm not the President...
AC
2,500+ Posts
Energy is a big driver, because there are so few economic sectors that aren't significantly impacted by energy costs. Ultimately, it's going to be a problem for Democratic administrations long term until there's a political realignment, because their agenda invites high energy costs. They don't like inflation, but large parts of the party do like expensive energy because it helps enable their environmental goals. At this point, I think we it's pretty clear that environmental radicalism is becoming a stronger, not weaker force, within the party. That means the Biden Administration and subsequent Democratic administrations will be under stronger pressure to enact policies that drive up energy costs and therefore inflation.
Monahorns
10,000+ Posts
It can hurt the debtor yes if nominal $s are only taken into account. However, if deflation ever came to that point there could be ways to update the debt and new rules could follow.
But it doesn't discourage investment. Deflation encourages investment by encouraging savings. Inflation encourages consumption and thereby limits savings and investment. Investing through adding $s into the system encourages nonproductive activity and actually consumes real capital. Capital is savings. Our banks have said otherwise for 100 years now to our own demise.
AC
2,500+ Posts
That’s a statue.
It probably ain't going away anytime soon...
US inflation could stick around, economic expert says
Inflation Will Keep Hitting Consumers in 2022: 2 Stocks That Are Smart Buys | The Motley Fool
After a shocker in 2021, where might inflation go in 2022?
Inflation Hits 15%, Fossil Fuels Boom, And A Hypersonic Cold War Starts... Here Are The Predictions For 2022
Forbes is quoting Saxo Bank which is predicting 15% annual inflation for 2022 -- sounds quite a bit high.
"Early retirement has meant the U.S. workforce is much smaller after Covid. Other workers have realized they no longer want to work grueling hours for low pay. They are demanding a better experience: better job conditions, higher wages, more flexibility, and a sense of purpose from work. "The pandemic has created an awakening of workers," says Demik.
Employers will therefore have to increase wages for less desirable jobs. These increases could hit the "unprecedented" double-digit mark. Combine that with all the other inflationary pressures, an energy crisis, and supply chain disruption, and suddenly things spin out of control.
In such a scenario, the Federal Reserve will try to react, says Demik. "But this is already too late. It has lost credibility." Saxo Bank says U.S. inflation could go above 15% before 2023.
The result will be extreme volatility in U.S. equity and credit markets as the Federal Reserve tries to regain credibility and shove inflation back into the single digits."
US inflation could stick around, economic expert says
Inflation Will Keep Hitting Consumers in 2022: 2 Stocks That Are Smart Buys | The Motley Fool
After a shocker in 2021, where might inflation go in 2022?
Inflation Hits 15%, Fossil Fuels Boom, And A Hypersonic Cold War Starts... Here Are The Predictions For 2022
Forbes is quoting Saxo Bank which is predicting 15% annual inflation for 2022 -- sounds quite a bit high.
"Early retirement has meant the U.S. workforce is much smaller after Covid. Other workers have realized they no longer want to work grueling hours for low pay. They are demanding a better experience: better job conditions, higher wages, more flexibility, and a sense of purpose from work. "The pandemic has created an awakening of workers," says Demik.
Employers will therefore have to increase wages for less desirable jobs. These increases could hit the "unprecedented" double-digit mark. Combine that with all the other inflationary pressures, an energy crisis, and supply chain disruption, and suddenly things spin out of control.
In such a scenario, the Federal Reserve will try to react, says Demik. "But this is already too late. It has lost credibility." Saxo Bank says U.S. inflation could go above 15% before 2023.
The result will be extreme volatility in U.S. equity and credit markets as the Federal Reserve tries to regain credibility and shove inflation back into the single digits."
A lot of low level employees need exactly that kind of treatment. Not all of them, but there are a bunch of lazy ******** who spend their days posting on Hornfans (for example) instead of doing the job they are being paid to do.The old way of managing low-level employees at many shops:
No more (and that's probably a good thing...).
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