Deflation isn’t the only type of depression…get ready!

As we know, we did in fact almost have a proper (and IMO much needed) bear deflation period. It was SOOOO close. But as the US goes…so does the entire world economy more less. If we have a full deflationary depression so will the other countries. If some manage to show strength their exports will be too expensive and they’ll end up battered eventually. This is the power the Bretton Woods brought to our table here in the US. With essentially everything “pegged” to our currency we have absolute power. A power we have abused horribly. Or should I say the rich bankers coerced us to abuse? We are merely puppets on a string.

In our recent recession the US wealth AND foreign wealth stepped in heavy. Compared to recent pricing (TA wise) we were at a bargain prices on many things. I must ask though, FA wise can you stand behind the US and it’s balance sheet? I’ve never done a real balance sheet and I’d be interested to see what some come up with since I have no formal training. Bottom line for me is this…buying because you HAVE to is far different that buying because you WANT to.

Setting TA and FA aside, here’s the reason IMO why foreigners are buying shit up here. In part like we said…everything is “pegged” to the US and they don’t wanna crash along with us. But also with the newly flooded money supply practically EVERYTHING (staple of life wise) will shoot up in value. We have far more dollars chasing the same goods. They don’t want to have USD on hand, they want to have goods that people will buy with the USD. If you save now you are a fool. USD will be losing ground in terms of spending power. INVESTING is far different than saving on something lame like a CD or bank instrument. I know this…but how many others do?

FAR MORE DOLLARS!!!

As an example of buying because you HAVE to…

I am out of the tech loop since I was let go last year. I didn’t know Intel built a US campus. I bet Intel bought here in the US for a few big reasons…and IMO quality of labor is NOT one. Appreciation of the property would be a major reason I would assume. Also, they have an interest or stake in the fire. WE are the people buying their computer chips and if we collapse so does their market. Again, it’s out of necessity not desire IMO.

Inflation can and will continue to create and transfer MASSIVE amounts of paper wealth. The concern I have is the wealth flows from those that do all the work (middle class) into the hands of those that do nothing (wealthy). And what the middle class will eventually be left with will be worthless paper assets (401k, mutual funds etc…) I understand the biz are the ones taking risk and they need to profit, but after taxes etc… we are slaves to the system. We as consumers are so debt strapped we NEED these jobs and we NEED the pay rates to continue rising just to cover interest and inflated costs of living. Everybody is strapped with leveraged liabilities in the US and our nest eggs are trapped in fictional paper assets…that is a concern of EPIC proportions to me.

Are service jobs really worth $30+ an hour? I guess technically we could be paid $1,000 an hour and something like a loaf of bread could be $100. If they can continue to raise wages in pace with inflation then the bubble could grow and grow and grow in theory. Sure is becoming a slippery slope if ya ask me.