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Welcome To Hyperinflation Hell: Following Currency Devaluation, Belarus Economy Implodes, Sets Blueprint For Developed World Future
"A ‘91-style meltdown is almost inevitable." So says Alexei Moiseev, chief economist at VTB Capital, the investment-banking arm of Russia’s second-largest lender, discussing the imminent economic catastrophe that is sure to engulf Belarus following the surprise devaluation of the country's currency by over 50%, which we announced on Monday. "Unless Belarus heeds Russia’s call for mass privatization
of state assets, it is headed for “hyperinflation, massive un-
and under-employment, and a shutdown of production" Moiseev concludes. Ah: "privatization" as Greece is about to learn, the lovely word that describes a fire sale of assets to one's creditors, courtesy of a "globalized" new world order. Ironically, this is precisely the warning that will be lobbed at each country in the developed world, as the global race to devalue currencies, first against each other on a relative basis, and ultimately against hard currencies, or on an absolute basis, as the world realizes that there simply is not enough cash flow to cover the interest payments on a debt load, in both the public and private sectors, that continues to rise at an astronomic rate, even as the world prepares to exit from the latest transitory, centrally-planned bounce in the Great Financial Crisis-cum-Depression that started in earnest in 2007 and has been progressing ever since. Ultimately, Belarus will succumb to hyperinflation, as will each and every other government seeking to devalue its currency (hint: all of them): "Unless Belarus heeds Russia’s call for mass privatization
of state assets, it is headed for “hyperinflation, massive un-
and under-employment, and a shutdown of production,” VTB’s
Moiseev said. The ruble will slide to 10,000 per dollar, he
added." Of course, this is the primary side effect of attempting to avoid formal bankruptcy through currency devaluation. And all those who continue to believe deflation is an outcome that will be allowed by the Fed, need to look just to the former Soviet satellite to see what lies in store for everyone currently doing all in their power to devalue their currency.
First look at the Belarus Ruble chart below: this is what always happens to every country that resolutely continues to live outside its means. Always.
And here are some additional observations from Bloomberg on the country that everyone in the media continues to ignore, yet which will very soon be the model for virtually everyone else engaging in central planning warfare.
The Belarusian central bank let the managed ruble weaken by 36 percent versus the dollar on May 24 as demand for dollars and euros from importers and households threatened to derail an economy already laboring under a current-account deficit equal to 16 percent of gross domestic product. Russia and other former Soviet partners last week agreed to give Belarus a $3 billion loan and urged President Aleksandr Lukashenko’s government to sell $7.5 billion of assets to replenish the state’s coffers.
Finance ministers from former Soviet nations agreed in Minsk on May 19 to give Belarus up to $3.5 billion over three years, with the first $800 million payment expected in the week after a separate meeting on June 4, Russian Finance Minister Alexei Kudrin said in Moscow yesterday.
The Nationalnyi Bank Respubliki Belarus set its official dollar-ruble rate at 4,931 for today’s trading, from 3,155 on May 23, according to its web site. Trading of foreign currency between companies, banks and individuals needs to stay within a 2 percent range of the daily rate, the regulator said May 23, when it announced the devaluation and reintroduced restrictions lifted on the interbank market on April 19 and for households on May 11.
Devaluing the currency will only worsen the situation for Belarus, VTB’s Moiseev said.
“The main problem is that the economy produces goods which consist of little else than a combination of imported spare parts,” he said. “So devaluation only makes things worse.”
Belarus’s economy effectively collapsed in 1991 as the disintegration of the Soviet Union eliminated natural markets for the country’s exports of farm machinery, textiles and agricultural products.
The catalyst for the country's imploding economy: socialism and price controls. Sound familiar?
Lukashenko reintroduced controls on prices and the currency and re-nationalized some companies and infrastructure after coming to power in July, 1994, on a platform of “market socialism.” The nation’s economy returned to growth in 1996, according to World Bank data.
At the Minsk Refrigerator Plant Co. shop in the capital today, about 20 people queued in drizzling rain to use their rubles to buy fridges. While the shop didn’t open on the day of the devaluation, most of the models in the store already had ‘Sold Out’ stickers on their doors.
“I came on Saturday and it was a nightmare, the store was stormed by people who wanted to spend their rubles because of rumors about the devaluation,” said Nikolay, a 74-year-old pensioner who declined to provide his last name. His entire savings of 6 million rubles now buy one fridge compared with three before the devaluation, he said.
The people are not happy...
The devaluation lifted the local price of automobile fuels as much as 24 percent, according to Belneftekhim, an industry group for the country’s oil sector. Last night, about 50 people protested the price increase in the car park of a Minsk hypermarket.
“I can’t describe how I feel without using obscenities, this is all our government’s fault,” said Sergey, a 32-year old attending the protest who works for a computer importer. “The whole world tells them, guys, you have economic problems, you should do something, and all they did was live off getting more and more loans.”
Who can blame the country if it devolves into civil war: as a result of Monday's decision the average salary was "1.6 million rubles
in April, according to the government statistician. Converted
into dollars, it fell to $325 after the May 24 devaluation, from
$507 a day earlier, using central bank exchange rates."
Naturally, the IMF wuz here:
Both the IMF and the EBRD have blamed Lukashenko’s spending before last year’s presidential election for much of the economy’s woes. Lending was increased by 38 percent last year and public-sector salaries rose by about 50 percent, the Washington-based IMF said in a March 9 report.
Belarus got a $3.5 billion bailout loan from the IMF during the global credit crisis and the country has more than $2 billion of ruble and dollar debt outstanding. Foreign-currency reserves hit a 1 1/2-year low in March.
“The ruble is probably still too strong, but devaluation hurts the average consumer through imported inflation and deteriorating purchasing power,” Sanna Kurronen, an economist in Helsinki at Danske Bank A/S, said by e-mail yesterday. “There is really no easy way out of this economic distress and the only way is to do a major reform in the country.”
Here comes hyperinflation...
The price of children’s diapers has “gone completely insane” in Minsk, said Natalia, a 24-year-old mother also queuing outside the refrigerator store. “I used to buy a pack for 69,000 rubles, now they cost 140,000,” or almost half the 343,260-ruble monthly child benefit paid by the government, she said.
“We have become paupers,” said Tatiana, a 70-year-old woman in the line who also declined to give her last name. “We have been squeezed into a corner by this devaluation.”
Belarus’s dollar debt has been buoyed by news of the Russian loan, with the yield on the government’s debt due 2015 dropping four basis points to 9.881 percent by 6:35 p.m. in Minsk, the lowest since March 14. Dollar-denominated notes due 2018 yielded 10.38 percent, down six basis points.
The country has raised its refinancing rate twice since April 20 to 14 percent, the highest in Europe. The central bank also stopped selling foreign currency out of its reserves in March and will continue to stay out of currency markets, spokesman Anatoly Drozdov said by phone in Minsk yesterday.
...And following that, complete socio-economic collapse
Unless Belarus heeds Russia’s call for mass privatization of state assets, it is headed for “hyperinflation, massive un- and under-employment, and a shutdown of production,” VTB’s Moiseev said. The ruble will slide to 10,000 per dollar, he added.
Unemployment was 0.7 percent in December, according to government data. Inflation accelerated to 14 percent in March, the fastest since April 2009 and more than neighboring Russia’s 9.6 percent in April. Imports into Belarus exceeded exports by $7.3 billion at the end of 2009, according to the latest annual data available.
Russian media are creating a “flurry” of speculation about the nation’s asset sales so they can “make good at our expense,” Lukashenko said today in Astana, the capital of Kazakhstan, according to comments reported by state news agency Belta. “But we will not throw anything to anybody for nothing.”
Note the parallels to Greece, which would follow the same fate if it were to make the choice of returning to the drachma.
Alas, there is nothing left to add: this is the future, and it is coming to a developed country near you.
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That is one hell of a dice roll.
Why?
While many who are aware would never be caught dead buying fiat backed government debt, can you honestly dismiss the possibility, or even probability, that in the event of a serious global financial and economic crisis and/or downturn, massive pensions, mutual funds and other high level AUM decision makers would NOT still pile into U.S. treasuries, out of a basic desire to deploy what is conventionally accepted as asset preservation strategy?
I am not dismissing the possibility, but what about the alternatives? Each dollar of debt and each day that passes erodes the conventional wisdom regarding US paper. I am not so sure those people are looking at the US balance sheet with a smile on their face and I am fairly sure they are preparing alternatives. How long can this stale strategy go on?
Indeed, what does happen after that next crisis ends and, lets suppose, people pile into U.S. treasuries? Will they stay in them forever?.... Will a game of musical chairs unfold?
It seems that the intervals between shocks/crisis for the US are nearer and nearer each time. They may have one kick of the can left......if that.
Will the next be the one that 'breaks the camel's back'? The next crisis could, whether warranted or unwarranted, thrust the next country or group of countries to the monetary/financial foreground (albeit after tremendous chaos)..... Or through a managed decent, however unlikely.
The old Adage, "Don't fight the Fed", will be wrong one day. And what an epic and phenomenal day that day will be. How many more oscillations will time allow?
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For earlier post.
But can they? It seems to me that this a Greek Tragedy (pardon the pun). I believe you are putting too much faith in the elected officials. They seem to be more reactive than proactive. Aside from a Ron Paul type coming in and cutting things left, right and center, I am unsure if any of their changes will be genuine or meaningful.
Democrats want the entitlement programs and 'big government' and the Republicans want lower taxes and want small government (however history seems to go against this as well) yet want defense spending. Both parties have become too entrenched in 'Politics as Usual' with the dog and pony show. Look to the recent praise of their so called 'cut', it sure put a dent in the deficit.
Corporations who feed off the government, Defence (Republican), Big Pharma (Democrat) & Finance (Both).......etc... have armies of lobbyists and think tanks that will be in full force to keep their contracts and policies continued. All this talk of dealing with the debt ceiling is just another dog and pony show for the upcoming elections. I would not be so hopeful.
I believe David Stockman to be correct when says that the only thing that will make both parties wake up is some sort of crisis, whether it is in the currency/bond market.
Then the party stops.....
Rickards actual thesis is the following:
1. People who believe QE ending is going to be the end of the world unless there is QE3 immediately are wrong. This is binary thinking.
2. There are many things the Fed can do, one of which is to play around with its 1.6T in assets to continue monetization.
He doesn't state that QE3 isn't going to happen. Just that if QE3 doesn't get announced in June, that we won't go over a cliff (into deflationary hell).
Congress, and the public is just a side show. The Fed was created to insulation banking policy from politics, i.e. to have the ability to operate without Congressional approval. If Congress can or can't act, it doesn't matter. Bernanke is not going to wait around to get anyone's approval for anything.
Not only that, but since there is an election coming up, the commander-in-chief is going to insist that assets be re-inflated throughout his campaign.
>> Stampede of substitute buyers of U.S. Treasury Debt.
Good luck with that one. Without China, Japan, Bill Gross, Saudi Arabia and those odd transactions from the Cayman Islands (making up 20% of the takedown), I can tell you who will be the buyer of last resort of US bonds (after the Treasury that is). It'll be the US citizens with their retirement funds (although those wouldn't even get us through the elections).
No. If I may add color commentary
1. Bernanke gets far too much 'credit' for this QE stuff. Buying the bad loans off of the bank balance sheets and back-stopping federal programs like Fannie and Freddie were most assuredly done with the blessing of the Federal government folks -- The FED realized it needed to save the banking system and so did the government - lip service aside. This is a symbiotic relationship and shows the level of cooperation between these two entities. THey will be partners throughout this debacle
2. The FED monitizes the Treasury debt, because if it didn't, the dollar would be toast and we would be in the news now as the hyperinflation capital of the world. It is also absorbing as much debt as it can to tampen down the interest rate shock - if the bond market were to spin out of control (as you know, Treasury doesn't effectively pay interest to the FED)
3. The FED charter has been expanded and it has been given emergency powers -- this is in place for obvious reasons -- it has and will backstop anything that might smell of a credit collapse - and it's balance sheet is accountable to nobody - so it can rescue REITS, pension funds, insurance companies, money markets, etc by flooding those sectors with a fire hose of liquidity at the drop of a hat
4. The amount of transfer payments that exist in the economy today is significant - are given to people/entities that did not create any value (food stamps, welfare, medicaid, corporate subsidies, NGO grants, block grants, state aid, etc) and to others that receive far more than they put in (unemployment, government pensions, etc). These people/entities compete with productive people/entities in the marketplace for the same goods - putting a floor on on some items -- stopping deflation in basic commodities
5. Excess reserves in banks that have been put there by the FED, via purchases of dead debt, is LIVE money. It can buy equities, commodities, precious metals, etc at a moment's notice. This is money that was not generated through productive means. Much like the transfer payments above, this CAN and WILL put a floor on these products
6. There is no possible tax solution to the current debt situation AND unlike the 1930s, there is no WWIII that will pull us out -- we don't have excessive, readily available natural resources that we can independently exploit nor is half the world in tatters (yet) to give us the 'go to' dominance we had back then
7. Debt is strangling us as a nation. I'm sure we're not the only people who realize this. These folks play 'war games' too. There are various scenarios on the table. I'm sure the cost/benefit analysis of a hyperinflation scenario .vis a vis. a deflationary scenario has been run with more variables than we can think of in our livingrooms. They may not choose wisely or execute properly -- but they probably have a ranking of likely outcomes and those they think they could manage
Wiping out all debt and starting from scratch is what governments have always done. They want to wipe out their debt. Our debt just comes along for the ride...
I was never Chumbawumba
On your point 7.
It is definitely interesting, we call these politicians and public servants idiots. However, most of them are not as stupid as they seem or their backing interests. We see their public facade but not the real personalities or exchanges. We have to read between the lines, most of the time (DSK).
Jim Rickards touched upon this. http://youtu.be/ckEoUxAjgls
I highly recommend watching this if one has yet to see it.
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I get knocked down, but I get up again.
Those were real gold backed dollars back then. The same way we are deflating vs gold now. If they let the system deflate vs debt backed fiat, the debt backing becomes unservicable and the entire monetary system collapses.
You are perfectly right. Deflation is happening when the currency is backed by gold, and never with a fiat currency.
I'm siding with akak here...
TruthInSunshine
"All the hyperinflationists fail to give much, let alone quality, analysis to debt destruction, which is the same as money/fiat destruction, when presenting their cases and models for inflation."
Yeap
"ZIRP is the reason for the surge in commodities and other speculative asset classes as of late, more than any other causal force put into motion by the Fed."
yeap
"Presenting a case for hyperinflation in the 'developed world' beginning with events in Belarus is painful to read."
True, but funny nevertheless
"QE is dead with a Do Not Resuscitate advanced directive. QE failed. Everyone knows it."
Very nice.
blah blah blah
big bouncing boobies
blah blah blah..
I talked about the potential for an oscillation between staflation and deflation with Reggie Middleton in my recent interview with him on Sound Money 91.5FM NYC. Here is the link:
http://coveringdelta.wordpress.com/2011/05/25/sound-money-podcast-interv...
No. QE is being proven to be the required elixer for market levitation. Thus much, much more QE is a comin'...
QE is in fact "the elixir that makes European bailouts possible." Should QE end (and I think it is in fact ending) then "those bailouts will cost real sovereignty now."
Golf Clap ....
I think Gonzo Lira is selling donuts now ....
I see a lot of people suddenly thinking we are going to get some deflation only because the Euro and commodities got raided again to bounce the comparative decline of the dollar. I like seeing that because I know most people will be totally on the wrong side. If you want to define deflation as a bad economy for x quarters and a falling stock market, fine. But if you want to define deflation as a monetary phenomena, it isn't going to happen. It is not possible for a debt based fiat system to have deflation without completely dying and going straight to hyper inflation and death. A banking system, an economy and a tax base is required to keep the debt/fiat system in somewhat of a balance with debt service.
The only thing more inflationary than QE supporting the Treasury market is no QE supporting the Treasury market.
@Emperor Quinvarius
"I see a lot of people suddenly thinking we are going to get some deflation..."
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No... not suddenly.
And only as a possibility, not a given.
You called me Emperor. I will let that stand.
where is there even a scintilla of deflation in the American economy? We have a inflation induced slowdown--but no one is talking deflation ala "going into 9/11." Europe is a totally different animal--"sound money" from the get-go. Which of course has been nothing more than "hasta la vista all you non-Germans." As "the community" tears itself apart since it never made sense to begin with i think the deflationary implications are obvious SHOULD one of "larger nations" actually just say "i quit." Belarus? "What is a Belorussian exactly?" My first thought is "that's Poland isn't it?" Anywho "here's your bottle of Johnny Walker Red and here's your carton of Marlboro Reds. Can I tour your country for a week now?"
Try home prices. The mess we are still dealing with.
Stocks would be deflating if measured in inflation adjusted dollars (and this is with massive intervention).
No one is arguing we don't have deflation, but rather what the response will be: nothing (deflationists), print (inflationists)
food, fuel, heating oil
ummm.. yeah, it's inflating here and now.
while jobs and income continue to head south to boot.
Screwed-flation
My man, don't let them give you shit. You are right on target -- deflationary forces are too strong and we have nothing but stagflation, followed by deflation ahead of us.
Here is where you got things wrong. After it becomes pianfully obvious the deflation is here, QE3+ will proceed. It has to. This country is build on debt and deflation is the enemy. The crazy mary-go-round will go on until we either jump-start the economy or collapse.
QE will not be renewed and "suddenly all that inflation will be seen for exactly what it is." Inflation. The jury is still out...amazingly...on "what an interest rate is." Well looked at vis a vis Europe "I'm glad we don't have 24 percent unemployment" with a German monetary policy to boot myself.
"QE will not be renewed"
Right. And the dept ceiling will not be raised and gov't will balance their budget within the next 3 months. And these two events will definitely be deflationary. If you believe in them.
And the lion shall lie down with the lamb, Jon Nadler will scream "Buy Gold Now!", and angels shall fly from my asshole.
the thought of Angles in your asshole is disturbing. "Is that a fart I hear or tears from Heaven?" Anywho the debt ceiling will be raised precisely BECAUSE QE is ending. Tax revenues are rising as the State and local level--though far from evenly--and to say "there's no possiblity of cutting spending" think again. Call it "Libyan austerity." It's coming. Insofar as the existence of deflation "why did the same tires i bought just 4 years ago double in price?" they are the same tires. they did not grow little feet and move my big truck without needing fuel after i bought them, either.
.
I disagree with you, there will be Hyperinflation in the US. Our govt. has to cover up their crimes and their buddies (bankers) crimes. They paper over the issue and then use the papering over to obfuscate what happened and find something or someone to blame (just how they blamed the homeowners for the problem in 2007). The US govt. has to many promises on the back burner and not enough money. You hear it in the political arena already with the changing of SS and Medicare and other benefits. They know what is coming and they know one thing, those useful idiots are useful while they are able to be feed. But once they see what these laws they are trying to inact affect them, they won't be so useful, they will be a mob.
http://en.wikipedia.org/wiki/Argentine_economic_crisis_(1999%E2%80%932002)
Who's going want to to hold debt money if the debtors are deadbeats?
single most prescient comment in this whole argument, and what deflationists fail to understand.
When debtmoney is in a state of cascading, systemic default, it becomes worthless. The USG which backs is bankrupt. The FRB is bankrupt but/for their ability to print.
The deflationists do not understand what deflation is. Facing a future of aggregate contraction, ALL PRESENT DEBTS must be discounted. In essence, tomorrow cannot repay today's debts.
The FED can raise interest rates and contract the money supply all they want and all it will do is expose the fact that economic calculation using the dollar is no longer possible due to the counterparty risk it imposes on foreign investors. Governments will sell it for anything they can get and the dollar would hyperinflate in a matter of months.
The dollar is mortally wounded. It can die a slow death or a quick death, and steady moderate inflation will let it die a slower death while the central planners determine how to replace it. I don't rule out that they will raise the interest rate at some point, but the rate of return will necessarily be negative because the U.S. taxpayer no longer has the means to service its debt.
Wage deflation is the purest form of inflation - its just a inverse mind fuck - the CBs use the false metric of a single dollar/sterling /euro to what a person can buy - this is a deliberately wrong metric.
If they can't pay their credit debt collectively then the CBs will print real money to replace the fake debt money thus devaluing the currency.
This present monetory system is so over.
Wage deflation is the purest form of inflation - its just a inverse mind fuck - the CBs use the false metric of a single dollar/sterling /euro to what a person can buy - this is a deliberately wrong metric.
If they can't pay their credit debt collectively then the CBs will print real money to replace the fake debt money thus devaluing the currency.
This present monetory system is so over.
i agree. HOWEVER. Ireland cannot monetize it's debt--which is why i see the potential for a massive deflation in Europe because "the debt just isn't repaid" and all that remains is "the Remains of the Day." Basically "national bankruptcy is the result" because without the ability to inflate at all the end is brutally inevitible--you'll take te pay cut basically--as well i would imagine is the mass migration that could result from it. The USA is a HIGHLY centralized economic system (hence the bailouts being inevitible in my view) so the main question is "have the authorities created a true social unrest inflation or not?" With the ability (apparently) to keep rolling the debt over at lower and lower rates i say "no." But i ain't got no FBI badge on my shirt, that's fer sure--but i see nothing to stand in the way of sudden wage inflation. A banker has to eat, too.
+1 Mako and a couple of other posters.
Since the vast numbers of historical governments gone bust have been hyperinflationary scenarios, the burden of proof lies on your deflation thesis.
I take it you've explained yourself before because your post doesn't posit any arguments based on fact, simply "I'm mad as hell, and I'm not going to take it anymore." OK, explain why you think deflation will happen rather than hyperinflation.
Now, if by "deflationary collapse" you mean "the S&P loses 15%," then yes, I'd be inclined to agree. We need some sort of event to give Bernanke the cover to do what he has said he would do consistently. Since he is terrified of a repeat of the Great Depression, which he believes was caused by deflation, he will err on the side of inflation (as he has). Incidentally, the idea that the Great Depression was a deflation, and not an inflationary scenario is relatively new (1965?). I'm no expert, and I'm not saying deflations can't happen, but they are very rare. Hyperinflation is the easy, tried and true, "boil the frog in the pot so he doesn't revolt" scenario here.
Truth.
Seriously, don't drink prior to posting on ZH. Thanks
Fiat2Zero, yes, these are the points and historical facts that I keep hammering away at the deflationists about --- apparently, never with any success. The proponents of the deflationary scenario have one thing in common, I have observed: a complete ignorance of, or denial of, just about ALL of monetary history, and the fact that EVERY government that has found itself in the position in which the USA is today has either resorted or, or been forced into, the debasement or collapse of its fiat currency, wiping out the savings (and living standards) of its subjects in the process. When confronted with that damning fact, they invariably shut up and slink away. They would rather debate academic, ivory-tower theories than examine the known and undeniable historical record.
"We're going to have a deflationary collapse, before there's any possibility of hyperinflation"
>> Now that's funny. Some people just simply don't understand 101 economics... Sad...
Okay, so tell me how the United States will lose world reserve currency status, military hegemony and the largest base of consumers in any one nation and its assortment of allies in the west and east, which would all be necessary, in order for hyperinflation to occur?
Hyperinflation isn't 4% to 8% inflation per year. Hyperinflation is 4% to 8% inflation per day. On everything. When people buy entire store shelves of products at 8 a.m. because they won't be able to afford to at 8 p.m.
Hyperinflation literally means the U.S. implodes as a nation-state, world economic, military and political actor, leaving a vacuum about 100x the size of the one that the Soviet Union did when it imploded.
You really, honestly believe that this is possible, let alone likely?
If the U.S., which consumes a quarter of the world's oil, protects many OPEC nations, consumes more of the world's exports than any other single nation, has the largest and most advanced military force in history, and possesses the world's reserve currency experiences hyperinflation, the entire globe will be in flames.
I swear that I try to be tolerant of all dissenting viewpoints, but these comparisons to Weimar Germany, Zimbabwe, Argentina, and now, Belarus...they are seriously grating.
It'd be one thing to claim there's historical precedent and some comparative conclusions to be drawn by comparing and contrasting England and the U.S. over the last 8 decades, or so, and to form some theories.
It's quite another to compare and contrast the U.S. to Belarus or Zimbabwe.
I realize ZH takes dramatic license to the extreme to emphasize certain unsavory aspects of the current state of affairs in the U.S. and particular actions of politicians and non-politician monetary policy makers, but the hyperbole is over the top.
The U.S. has serious problems that will be game changers over the long run if they're not addressed in a serious and rational manner, and they may not be.
The U.S. is not going to experience hyperinflation. It's the epitome of idiocy to suggest this.
Forgive me, TiS, but I almost hear echoes of the disingenuous and hyperbolic fearmongering of Paulson, Geithner and Bernanke here.
No, if, and most likely when, hyperinflation DOES come to the USA and Europe, it will NOT be Armageddon meets Mad Max meets cannibal zombie hordes --- that is just central bankster self-serving propaganda. It WILL be painful, and it will cause immense suffering and the years-long impoverishment of many, many people, but it will NOT be the end of the world; well, it MAY be the end of the world for the sociopathic likes of the central banksters, but it may very well mark a Renaissance for the rest of us. Yes, the pain will no doubt be immense, but I categorically refuse to believe that the end of the financial and monetary status-quo, as corrupt and unsustainable as it is, is going to somehow mark the end of civilization --- and if it should happen to, then it couldn't have happened to a more deserving bunch, as we would have collectively proven that as a species, humanity is insane.
Hyperinflation is hyperinflation.
It's a collapse in the purchasing power of the nation-state's currency, domestically or abroad, and in the case of the U.S., it would mean the instantaneous collapse of the world's reserve currency, which would be a first ever historical event.
As tortuous it is to watch the complete and total idiocy and sham in D.C. and the debacle of monetary policy of the non-Federal Reserve Bank, there's no credible case to be made whatsoever that the U.S. is at risk, let alone imminent risk, of a bout of hyperinflation.
I think cries of hyperinflation is coming to the U.S. are disingenuous, to put it diplomatically.
We will then have to agree to disagree -- and I appreciate your polite and honest answers and discussion in this thread, which proves that members here can debate and argue without resorting to taunts and childish insults.
While I do not necessarily believe that hyperinflation MUST happen in the USA (and therefore much or all of the rest of the world), I do still sincerely believe that it is entirely possible, and at this point is more likely than not. And you rightly point out that if it does happen, it will be the first hyperinflation in the world's reserve currency --- but since the last 40 years (shamefully) mark the very first time in world history that EVERY nation has been operating with a purely fiat currency, it can truly be said that no matter what ends up happening with the US dollar, in that respect this time it IS different.
loss of faith in the dollar is already happening. In my poor dumshit opinion ..hyperinflation has already begun weeks ago. But i am just a german who shops and cooks, its just my opinion from observing price changes and how folks are buying silver to protect themselves. Average america is still clueless, but its the BIG money boys who get it and control what happens. We are so fucked!
loss of faith in the dollar is already happening. In my poor dumshit opinion ..hyperinflation has already begun weeks ago. But i am just a german who shops and cooks, its just my opinion from observing price changes and how folks are buying silver to protect themselves. Average america is still clueless, but its the BIG money boys who get it and control what happens. We are so fucked!
Akak, you said: "it MAY be the end of the world for the sociopathic likes of the central banksters, but it may very well mark a Renaissance for the rest of us. "
Which is plain wrong. Inflation *favors* banks and anyone who plays with large amounts of debt/leverage. *Deflation* is the end of the world for sociopathic banksters. It's why banks don't even want you to think about deflation. It's not on the menu of options they've put in front of you.
Truth, your ivory tower, I'm so much more well read than thou attitude is what is grating. Come down out and let your arguments speak for themselves.
Reserve currency status didn't occur overnight and it won't be lost overnight either. There are so many alternative currency agreements already accelerating, that saying it can't happen is foolish. It's binary thinking. The canard is that there needs to be one replacement, but think again. Welcome to the retracement of globalization and reintroduction of the bilateral accord. Yes it's messy, inconvenient, and sub optimal. But it sure beats the fuck out if not gettin paid.
And everyone needs to get paid, right?
The laundry list you mention, again absolutes. We don't need to get defeated absolutely, only checked left and right, the death of a thousand nicks and cuts. Not defeated, merely have our advantages neutralized.
So stop with your hyperbole calling nonsense and make a real argument.
Stop rolling your eyes, you're not lecturing your students.
You're here to fight, not huff and puff indignation.
Mr. TruthinSunshine, so it seems the other side of an argument is usually lonely. Exactly because you are in the minority here, your views should not be dismissed. There is no opportunity to "unjunk" you, thus the post.
F*ck this hyperinflation bullshit claim that's been made.
Lots of words, no valid points. Like the meaningless statement quoted.
We look around and see no deflation anywhere ...except housing, experiencing demand collapse of 30%, exceeding undelying 20% inflation, yielding net 10% drop in housing prices.
But that's it, the only area of falling prices.
Rising prices everywhere else.
I see now, you're a realtor. Oh yes, you're going to see lot's of price deflation ahead :)
like the posting said "
The price of children’s diapers has “gone completely insane” in Minsk, said Natalia, a 24-year-old mother also queuing outside the refrigerator store. “I used to buy a pack for 69,000 rubles, now they cost 140,000,” or almost half the 343,260-ruble monthly child benefit paid by the government, she said. "
just helps to prove that welfare suckers help to bring down an economy, free money isnt free its costs nations, AND fiat currency can not be trusted.
"In the absence of a gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good and thereafter decline to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as claims on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to be able to protect themselves.
This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard."
The above was said by Alan Greenspan, 'Gold and Economic Freedom' in 1966.
And what good will privatization do? That is just more raping and pillaginig by TPTB.
There you have it. Frustrate the people until they explode and begin killing themselves. Naturally, the perpetrators will have escaped. The bureaucrats will look at each other and declare they are blameless.
Wash - rinse - repeat
actually that does improve profitability immediately. perhaps the policy instead is "we'll cause a war in Europe"..."hopefully."
I thought I smelled a rat!
Thanks for that quote. It expresses in literal terms what we all here know and sense on a more gut level: it's war out there, war on wealth and savings. What more expeditious way to destroy middle class wealth than to have biflation aka the Fed having it's cake and eating too: debasing the dollar while short-circuting a domestic inflationary spiral ?
Hyperinflationist claptrap. If anyone here is actually drawing parallels between the economy / political structure / military / resources / monetary system / etc. of Belarus and the United States, my advice is close your browser and go outside. Get an ice cream and go to the zoo. Economics isn't your bag.
I want rent from the Usurper for using the WH! Not more words....just words.
http://www.youtube.com/watch?v=8M6x1H08aFc
Just dont touch my NFLX shares, Bitchez.
CRM, pig! With a dash of LNKD.
O.T.
Wiki War: Israel, Palestine dig digital trenches http://t.co/8kkWqsz
A point which the historically ignorant deflationary unicorn hunters ALWAYS fail to grasp.
Or, in other words, bankruptcy NEVER leads to one's credit rating rising.
Yes, everyone should know by now that only rabbits shit skittles.
Then why do they taste so awful? I'm sure if I keep eating them I'll find that promised rainbow
probably the HFCS, the carcinogenic dyes, or maybe the partially hydrogenated oils?
You have to keep all the UPCs and mail for it. No photocopies accepted.
i always thought they should put the trix rabbit on the cocoa puffs box...
Yep, just don't raise any on your homestead...
http://dailypaul.com/165881/petty-bureaucrats-attack-missouri-family
"A point which the historically ignorant deflationary unicorn hunters ALWAYS fail to grasp."
I strongly recent the reference to unicorns.
Not one Unicorn has ever harmed me, and I would take no pleasure in seeing any harmed.
Thank you very much.
How does one "recent" a reference to unicorns?
I've always wanted to try that.
Here's Charlie
http://www.youtube.com/watch?v=Q5im0Ssyyus
Monetary Regimes and Inflation - Peter Bernholz (the motherfucking bible on inflation):
http://www.goldonomic.com/Monetary_regimes_and_inflation.pdf
thanks for the link!
I thought Palyi's An Inflation Primer was the "Bible" on inflation.
http://mises.org/books/inflation_primer_palyi.pdf
The formula is being used again in plain sight
Marc Faber on Bloomberg discussing the delayed but ultimately imminent QE∞
Updated:
Faber Interview About China, U.S. Economieshttp://www.bloomberg.com/video/70183756/
"And all those who continue to believe deflation is an outcome that will be allowed by the Fed..."
__
Yes?
Did you call Tyler?
How may I help?
-
Tyler: Stop bouncing. Do you know who I am?
I may be mistaken, but I have a hard time envisioning endless FRN printing and deflation in the long run. We may have a deflationary collapse along the way (stock market cave-in and further deterioration of RE) but I think Heli-Ben is going to do anything he can to avoid allowing our banksters' balance sheets to implode.
QE 1,2, and the Stimulus were loudly signalled as a chance for banks to rebuild their balance sheets. They haven't taken it all too seriously, though manufacturers have. Even manufacturers with huge cash are issuing bonds. BB has been trying to keep deflation at a slow pace, invisible to most. The main game is to get people to ignore the fact that US standard of living and job security are steadily declining. The mass of people have been bought off with the sop of civil service jobs, refundable tax credits, and other delaying gimmicks, giving the corporations and private equity more time to move out of the US, spread their assets as protection against any one nation's tax attack. It has worked. I would say people with serious assets are in the process of doing the same thing. Gold? If it's left in one jurisdiction, it provides only a little security. This is the meaning of globalization (and I'm not even against it): Globalize so that no one set of voters or politicians can break you.
++++++++++++++++++++++++++++++++++++++
++++++++++++++++++++++++++++++++++++++
there are piles of ballast stones
littering beaches of the fiat countries..
reballasting the boat again honey....
have fun .got your cigars ..
Mission accomplished. It's my biggest gripe with people who I can talk to on a personal level. They continue to cooperate and fund the system that is wrecking other folks lives. Problem is, in my opinion, nobody wants to take the time to put themselves into other people's shoes, to much t.v. to catch up on after slaving at the job all day. The tea party would be a shinning example of this dislocated reality, people putting big banks and corporations ahead of fellow citizens. I think many American's have lost their feeling of unity, while loosing their individuality at the same time. Robot country.
Were funked, lets start this game over fresh for future generations who will know, for a short time at least, it pays to watch the politicians and propaganda.
"that'll be $650 for the four tires that cost you only $325 four years ago." "but i was told you were trying to hide my loss of my standard of living?" And yes "i do need drive to live."
if the Fed permits deflation, the USG undergoes fiscal collapse.
IT IS AS SIMPLE AS THAT. If the Fed won't make "money" available, the Congress will DISSOLVE THEM.
So for every citizen that had 10 ounces of gold is suddenly Rich!!!
So how do you figure that? explain.
The primary commodities of Belarus, Slavic women and blow, will be undervalued against Au... he's rich
if i'm doing the conversion right its 4,700,000.00 for an ounce of gold in Belarus
The way i see it a little shitty 250sq. m home in Belarus costs 66,9751,161 BYR
This person's gold may cover 4M BYR of that 66M BYR. 16.xx% of it - or about 160 oz of gold per small shitty house. Which is slightly below what our average in america might be for gold/house price. He's FAR from rich.
But what he did do was preserve his purchasing power - unlike his goldless neighbor...who is shitting now that his paper worth has been decimated overnight.
If you're not rich, gold might never MAKE you rich - just protected against paper games.
IMHO
I guess you meant 16 oz, not 160 oz.
.
i'm sorry - yes, 16 oz for a small,... house. my original math was 10oz for 4.x M BYR - when actually 1oz is 4M BYR.
freegold. google it.
or, http://fofoa.blogspot.com/2011/04/reference-point-gold-update-2.html
no, they just preserved their wealth, everyone else is just poor
In the land of the blind, the one-eyed man is king.
"in the land of the blind the one eyed man is king"
So, if a week ago a Belarusian hooker was 400 rubles, today she is 700 rubles. If I paid 1/4th ounce of gold a week ago, I would pay ---- ounce of gold today? Not a trick question.
if you work for IMF
it's free ...
till it ain't
Yes, and also incredible paranoid and most likely not sleeping through the night for the next 10 years.
Mind you, I'd rather be the one with the gold, every time; just saying, you may wish to stock up on lead as well.
So for every citizen that had 10 ounces of gold is suddenly Rich!!!
A Belarus citizen with 10 ounces of gold today, who can survive the next year or two without spending it, may well end up very rich. If they end up having to spend it, they will be survivors.
Who voted said government in?
Like there is ever any choice. In this country we have door number one and door number two, and both are horrible deals.
Our democracy doesnt work because each party's position maximizes bell curves, and there is no real dissent, diversity, or other viewpoints.
The parlimentary system is better than the bicameral system, in my humble opinion.
consent is only real if it is informed and indeed voluntary
choice is only real if you have viable alternatives
the facade of choice is almost as bad as the facade of consent.
Who voted said government in?
The oligarchs.rochelle rochelle.............a young currency's journey from deflation to hyperinflation.............an instance classic...
Meh. I watched Checkmate instead.
Nice Minsk reference, though.
http://www.reuters.com/article/2011/05/25/us-usa-economy-geithner-housin...
I peed myself when I heard Hillary walking down the hall toward my office.
- Geithner
Tyler???
Is the US headed to default by design so the Bankers can privatize our assets?
Sure and then re-ipo them.
After all the fees and costs related to the AIG re-ipo paid by Treasury to the BANKS: $385m
A photo montage of what's next:
http://www.youtube.com/watch?v=W0p30eNVeGw
Imagine how bad it would be without help from the IMF. LMFAO!
Man, why couldn't I have taken out my mortgage in BYR?
Good point. Dam.
Ben to your rescue.
Isn't there a volcano with pics burping somewhere? Maybe a few handfulls of tornados?
Oprah giving birth vid?
Mish and Denninger refuting the hyperinflesionistas in 3...2...1...
Why do the deflationary flat-earthers always throw out the strawman of hyperinflation as the ONLY possible alternative to their absurd deflationary thesis? Whatever happened to the possibility, nay, likelihood, of regular, old-fashioned, high-but-not-hyper inflation?
+1000000
Because they are jackasses.
Douche-inger takes the cake.
Dude has anal issues.
Just for that slur against Herr Oberstgruppenforumfuhrer Denninger, I BAN YOU!!
I wonder if Karl puts on big floppy shoes and a red ball on his nose before sitting down to write his daily "They must follow the law!" rants. Hey Karl, stop wearing down your keyboards, and go shout at the pigeons in the park --- some of them might actually care.
Denninger Angered, Bans Everyone.
http://randomlyspecific.com/?p=70
@akak
"Why do the deflationary flat-earthers always..."
My good Sir, I'll have you know that I believe in multi-dimensional Universes / Realities.
Furthermore, I accuse you Sir, yes you! of being a flat-earther.
There!
His rants are getting repetitive and senile imho.
Already done. Long winded, and not always on point.
http://globaleconomicanalysis.blogspot.com/2011/05/hyperinflation-nonsense-in-multiple.html
If Mish is going to continue hunting the unicorn of deflation, he should at least go out for once without his strawman partner of hyperinflation.
I am SO fucking sick of the hysterical and disingenuous bullshit constantly being peddled by these historically clueless and ignorant deflationist hacks! NOTHING in monetary history supports their pie-in-the-sky arguments --- NOTHING!
Well, some things do, but they are all *cough* "transitionary", and they never prevent the ultimate destruction of the currency, only postpone it.
@akak
" to continue hunting the unicorn of deflation..."
again with these spurious allegations of Unicorn hating.
again and for the record, I have never sought to harm a single Unicorn and will never do so.
Well, we will probably know sooner rather than later whether the deflationists, the hyper-inflationists, or the stagflationists are correct.
Well, recently once again, tyler has proposed a 4th option: A cycle of deflation followed by inflation.... with increasingly higher amplitudes.
I emailed Mish a couple nights ago asking for that dam towel, haha!
And I never said we wouldn't have some deflation, I said inflation will win over deflation cause Benny got a printing press and he gonna use it.
I WANT MY TOWEL!
People are always overly set in terms of binary choices. I choose the third choice which hasn't been determined as of yet. Both decisions, deflationary and hyperinflationary require infrastructure, constant steady stream of goods (oil, food, materials, clothes), skilled labour (are we seriously discussing a arts major being anything other than baby factory?).
All of the above requires commitment by the powers that be at this point in time. So far we are watching the rich eat each other alive. Then we are watching the suburban slobs get self absorbed that they aren't going to get their cookie at the end of a crappy career (why the fuck did they take liberal arts for a job they hate?). Either way of examining it all arguments lead back to "me, me, me".
While both sides are sawing back and forth on the lynch pin of their own capital, I expect what any SHITTY engineer understands is going to happen. That pin is going to break, then the shit really hits the fan.
What isn't even imagined is every country in europe at war. Not with each other, but with themselves. Contagion is hardly the word for it at that point and the stupid thing is they are all going to do it for imaginary value on pieces of paper and 1's and 0's in a computer somewhere.
This shit is going to get very, very, very bizarre very soon. It was hovering in the strange zone last year, after getting marketing material for the denver bunkers now available for the low low price of 3.5 million to house and feed a family of six around november it got weird. Now I suppose the next appropriate designation for the current situation is surreal. What comes next? My guess is Dada, blood filled landscapes, bits of people hanging from trees...fucked up 28 days later crap.
Interesting...
Note sure if i agree with everything you wrote (though, i welcome your autonomous thoughtstyle).... however, the IMO most universal thing to take away from your post, is the acceptance of uncertainity and volatility. In other words, it in the long run may make sense, to not so much focus exclusively on inflation, but instead on instability.... and thus, generally planning on ensuring one's own stability. While such a strategy wouldn't be as efficient as one handtailored to a specific scenario, it would naturally be the best "catch-it-all" strategy.
Coincidentally, commodities relevant to one's own survival (food, shelter, defense, connections) once again would be king. What would however involve changes, is methods of "wealth conservation". Personally, i would for such a case probably look for fiat currencies that are somewhat stable, yet as "independent" as possible from the countries that are in the line of fire right now.... and then mix this with a basket of metals.
To be blunt, I live in what is known as the "sticks". Could not give a damn about collecting paper. You are talking to one of those assholes that trade...for a living...x3 ETF's. I see the odd post on some junior playing with x1 or x2 because they have 50 grand to fuck with, I gladdly take it from them in around ten minutes of trading.
My whole work week after selling a 20 year old business involves around 45 minutes of time in my week.
Yes I own Silver, Gold and Land. Plenty of all three. All mean of these things mean SWEET FUCK ALL. I couldn't state it to you simpler. If you don't have a community to back you up, not just your family. It's meaningless. Completely useless without people to work WITH you not for you towards a common goal. The FIAT, gold, silver and paper is just to trade stuff for, but given an opportunity a starving man would trade his own mother for a slice of bread. When working a community, mine becomes 'ours' in a community sense. I would explain the details but I'll leave that up to yourself to figure out.
Ever see the Twilight Zone with the guy that hates people, sleeps in the bank vault, wakes up, world is rumble and he figures he can sink his ass in a chair and read forever. then breaks his glasses (badumdum! rimshot!). Nobody there to back him up.
When describing one's "own" survival, I'm not sure what universe you live in. I live in the universe where I'm a shitty plumber and I call someone I know then make an exchange of goods. When I need a tooth worked on, I can someone I know called a dentist.
I know in most cases that 99% of the people that live in the city couldn't give me their plumber or dentist's first name nor even hang with them for a coffee, pint or a deep ass laugh at a BBQ. Maybe that's the first problem right there.
When using the word OWN, nobody really owns anything, we're either renting it or sharing until we drop dead. Even if you bought it, everything you see is leased as long as you live. It's up to you to figure out how you are using your stuff until then. Keep it locked away, or pool it. Survival has more to do with options available and not maintaining a dogmatic facade of the last man on the planet able to measure beans from a tin cup.
Anyone watch "The Road", I swear that's the whole fucking movie. idiots that know the metric system YET can't put a seed in the ground. Mindblowing.
Did you notice where among the "king" things i mentioned "connections"? That is your "community" aspect and knowing people whom you trust and who trust you. Not sure about this, but i suspect that you invested a lot of effort in a reply, that was caused by me just mentioning an aspect once, intstead of multiple times (though, i appreciate you describing it in more detail).
As for "owning" something.... property is just a fancy word for "control" justified by law. People can control things (though, to a higher or lesser degree, and of course it can via environmental as well as human means by force be taken away from oneself). Even if you like to denounce ownership, the ability to control even is important to you, because if you (as well as your friends) had no degree of control over anything, you'd be fucked.
Again with absolutes?
Regardless of the position held. We're fucked. Last I looked they don't bury people with their silverware and TV's. Doesn't buy passage, doesn't cover the ferryman. Best anyone can do in a crappy situation is go talk to the neighbour, dogcatcher.
As far as ownership. Meh, it's an issue of who holds the lease of the "stuff" in the mean while. I played the game, I lost money, yet by some luck of the Irish I came out ahead. By ahead, I'm not meaning the crap I've collected. I'm just slightly wealthier in comparison when I was 17 and out the door without a nickle in my pocket and joining the Canadian Forces to sit in a shit hole swamp called Bosnia to dance for my dinner. It worked out. I didn't starve, made it through engineering with savings on the contract and made friends and contacts along the way.
Control is such a worthless concept. There are no controls, the mechanisms any engineer puts in place is at BEST a guessimate with math behind it to justify the position of the engineer to maintain their position. Professionally run into it far too often in my career, in current terms I believe it's called Silo building/Empire Building. In all cases I've observed all these castles are build on sand with quicksand right underneath. Once quicksand hits, the options vanish without help. Careerwise the best thing any young professional can do is fuck up baddly to learn what a horsewhipping feels like and how much "control" is really offered in a situation.
Think about a dentist, all it takes is one bad root canal procedure and that dentist will never heard the end of it. (no I'm not mentioning my Catayst to understanding failure). Connections can be community, but it's the ancient adage of a friend will help you kill a man, a best friend will help you bury the body as well. Just make sure you aren't in the "getting killed" category. Hubris doesn't serve anyone well if looking for the escape route only to find a locked door.
Hasn't it become probable by now, that i do not think in absolutes, unless something involes a generic logical impossibility?
When i say control, i don't mean any invented human concepts. I just mean raw force. as well as raw non-interfererence - I doubt you argue with the existance of this? I'm not talking about some stupid human concepts. I'm talking about plain old material physics: You can do something, or you cannot do something. Disclaimer: I do NOT encourage relying primarily on material power - i just do not reject its existence and thus relevance.
I intentionally do not reply to your third paragraph, because i prefer to leave it to individual "morality" (Though, personally regarding me specifically, i reject generic absolutes in this case totally. All that matters is if to me, as well as my "helper", is if it was considered "reasonable" and "fair".)
I'll restate a previous passing thought in another thread.
Trust and mistrust are things earned over time with friends.
As far as raw power, it's a thing humans have never been able hold on longer than an eyelash's blink. The wind is raw infinite power that is a constant, yet our best science hasn't been able to develop anything beyond a modification of a 6 thousand year old sail mechanism to push a blade or a tarp. Even then, there are lots of stories of sailors lost at sea for misreading what the wind is doing.
Water, the sheer mass of it covers 70% of the planet, best thing we know to do with it is to shit in it, then act surprised at e-coli outbreaks and killing a couple of hundred of people per week around the world.
Then there is the planet itself which generates 60 watts of electricity on every point of the planet constantly. We live on a giant magnet (ever wonder why electricity scales by 60 minus the ground? 120 in NA, 240 in EU...), yet the best thing we've found to do with it is cram humans into every square inch of it.
Humans however are, again, worthless and completely sunstruck with the minor accomplishments done so far that it is assumed control is granted instead of warranted. Raw power, even in terms of physical force of wiping people out, who cares. So far that hasn't stopped the human race, like cockroaches, step on most of them, more come back in a couple of years. Mainly because as a spieces we're dumb as pikes and we like to fuck. Proof in that is everyman at one point in time has thrown his cock into something that he would make the clear headed choice of fucking livestock before he stuck his dick in "that" again.
There are no promises or written objectives to life. Just that you make it long enough to fuck someone and procreate. What happens between then and now...it's a choice. Some choices have a bad outcome, others have a longer option chain that is more fun, but the outcome is the same. Bullet, starvation, time, whatever...these are options to an eventual unavoidable outcome based on timing. That would be dropping stone cold dead. When it comes, regardless of raw force, controlled circumstances or peaceful sleep. Dead is dead.
I don't think too hard about what type of life my chicken had before I snap it's neck, cut it off, pluck it to skin, lop the leg at the kneecaps then throw it in the oven at 375 with a greek lemon seasoning.
I do know that when that chicken is served with friends that play-mock me for owning chickens and I'm complimented on the meal that I'm in a better place than most of the planet. And during that whole transaction the only thing traded is bad jokes and booze.
I need to get some sleep now, but will replace this post with a reply later. I'd like to thank you for for the interesting discussion.
No worries, catch the chat tommorrow as well. Just looked at the clock...sigh...
Okay, the "topic" of our little subthread is getting rather wide... that would work fine for a chat, but on a medium like this, it's rather hard to manage. So, i'll try to get back to the original arguments.
You argued that control doesn't matter, because it is so temporary and uncertain. Then you argued that relying on friends and so on is the way to go. I think this is a rather biased way to argue.
Friends and trust isn't much less "temporary" and "uncertain" than power. With this i do not mean to say that power is more important than friends - rather, i'm argueing that both matters. If for example one has some reserve food (control), then this increases chances that when food is hard to get by, one will have a buffer. And if you have friends, who also have reserves or a way to produce/collect food, then chances become even better.
So, i don't buy into this "the one method to rule them all"... to me, it more seems to be a matter of how one combines available methods.
You had me at "greek lemon seasoning."
Seriously, when's dinner? I promise I'll be a better listener than your friends are for your doom and gloom.
I agree with all that you said about your community. Man is a social animal. Everything we have is from an invisible society that magically creates finished goods whose origins or fabrication techniques are completely unknown to us (well maybe origins - China - it's on the label, but you get my drift).
My challenge is that everyone has their head in the sand, and any of these topics are "so terribly, terribly boring and depressing." I can't blame people. I sometimes wish I could be reinserted into the Matrix, but I was rejected. The graft didn't take. So back in (my) "reality," where I'm simultaneously preparing for any number of emergency SHTF scenarios. Oh, you say there's a new one? A wandering brown dwarf star will come within 0.5 AUs of earth in September? No problem, let me just throw that on the stack of shit I'm dealing with. Maybe I can use my gold to fabricate a shield to protect me from the cosmic ray bombardment (great, see once you can deal with _one_ catastrophe, the next one isn't so bad).
The only other person that takes me seriously is a friend who is a hedge fund manager, who is even more prepared than I am (not quite to the farm buying stage, or flight below the equator, but getting there). And even he and I can only briefly talk about things before we have to go back, to our community, that accepts us but is willfully not considering these depressing subjects. Even the hedgie said, "Hey, I stopped reading ZH for awhile, I had to unplug." So I guess the Matrix may take him back after all (but where does that leave me)?
My hope is that there is some time for people to adjust and at least see the reason for my preparations. At that point they'll be motivated. Hopefully there will be enough time.
In point of fact, you're right about the inflation/deflation chocolate/peanut butter arguments. They are false. We've got a very dynamic, fragile, imploding set of systems that no one understands fully. We'll just have to try to adapt.
BTW, maybe I can get that recipe for the chicken...let's see, snap neck...
My plantain & banana plants are making a comeback. I have been setting up a little taro nursery (12 varieties), also have 4 sweet potato varieties including the bad-ass PR 04-06. On cassavas, I've got Amerindian bread cassava & Colombian CM-3311. I have 25 Dark Cornish baby chicks scheduled for delivery. The people I partner with are getting their seedbeds ready.
We're on track.
Bring the currency collapse mo-fo's.
Have you tried growing breadfruit as well?
Granted, it's going to take a few years to grow a tree large enough to be productive, but it is a very underrated food --- if you have the climate for it, and it sounds like you might.
I have never grown breadfruit. There are two kinds, at least. One is full of bean like seed pods.
I do like it, however trees grow very high, like lots of water and produce all their fruits within a few short weeks.
I did not realize that --- I was under the impression that the fruiting season lasted for several months.
I was in Hawaii a few months ago (Big Island) visiting friends, and bought breadfruit at the farmer's markets every chance I got! There's something about it that I find very appealing, MUCH more interesting than say potatoes.
I really appreciate your posts man.
I think the reason that the debate has become so stark is because of the size of the debt. The fear is that any significant amount of inflation would lead to either a) suffocating interest rates or b) complete loss of faith in currency