*Investors Blog*
- Thread starter Warstud
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Most people haven't a clue who is responsible anyway. There was also a 70s recession that ended in the early 1980s
These things usually are the result of many policies and actions over time. The 70’s saw the Saudi oil embargo, Bretton Woods and increased social spending.
What we are seeing right now is a spike in inflation due to untold trillions of $$ flooding the economy. We have gone from normal background inflation to 17.15% in a flash. That is not normal and is unprecedented.
How does that explain inflation around the world?
Certainly 2+ years of Covid and now war are/will have huge global repercussions. The next few years will be challenging. We're planning to hunker down a bit and adjust our lifestyle to accommodate the changes. Not too difficult when we are already somewhat minimalists and don't follow the lifestyle of being entitled.
We live in a global economy.
The stock market is not the economy. About 85% of the market is owned by the top 10% of the population by wealth.
Inflation is due to:
The stock market is not the economy. About 85% of the market is owned by the top 10% of the population by wealth.
Inflation is due to:
- The pandemic caused supply chain disruption. Classic cost push.
- Pent up demand due to pandemic.
- The very high employment.
- Companies, such as the oil companies, record profits. Price elasticity.
- Cheap credit. Classic demand pull.
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Trillions and Trillions of money pumped into economy over the past 2 years have distorted lots of things.
So many bad things happening all at once here and around the globe.
Things in China are not currently going so well. China sneezes and USA catches a cold economically.
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I don't agree with that statement because if you look at the selloff we had on friday...... it was all about the fed hiking interest rates which slows down the economy. I will agree though the Market prices in the rate hikes and slower economy ahead of time.
Can you supply some support for this statement? Money Supply is not a standalone cause of inflation. Inflation depends on production and/or consumer preferences. And it gets more detailed from there, such as product price elasticity.
Inflation kicked into high gear due to the unmentionable and the management of it.
It’s a bit early for me and I’m on my first cup of coffee but I will try to make my point.
The unmentionable thing was the trigger so to speak. The entire thing was mismanaged as we didn’t understand it. Businesses closed, people out of work and the government poured money into the economy to keep everyone afloat.
Now in the past 1.5 years the government has poured trillions of $$ into the economy, much of it not related to the
. This is unprecedented. People stayed home and got paid. Now that businesses are opening back up the workers are hesitating to go back. Eventually the free ride has to end. We have a huge debt to pay back.
The worst effect of all of this is that we have set a horrible precedent. Are we going to shut down everything anytime a bad flu or whatever comes around?
I’ll stop there. I don’t want to get this locked.
Disagree with trigger; it was, by far, the cause as I detailed in post #87. You are spot on with mismanagement.It’s a bit early for me and I’m on my first cup of coffee but I will try to make my point.
The unmentionable thing was the trigger so to speak. The entire thing was mismanaged as we didn’t understand it. Businesses closed, people out of work and the government poured money into the economy to keep everyone afloat.
Now in the past 1.5 years the government has poured trillions of $$ into the economy, much of it not related to the
This is unprecedented. People stayed home and got paid. Now that businesses are opening back up the workers are hesitating to go back. Eventually the free ride has to end. We have a huge debt to pay back.
The worst effect of all of this is that we have set a horrible precedent. Are we going to shut down everything anytime a bad flu or whatever comes around?
I’ll stop there. I don’t want to get this locked.
The 1.5 year statement is simply not true. In fact the Fed is slowing the economy by raising rates.
Inflation is dependent on production and or consumer preference at the highest level. One level down and you have price elasticity of products (gas prices).
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Real inflation is almost 20%.
With the unmentionable and now the war in Europe, the unknowns rule everything. This is where a long term investment strategy pays off.
Maybe just once every pandemic. Seems like the last one was 100 years ago. Maybe there won't be another one. Look what happened during the depression, haven't had one since. Look what happened after the last collapse in 2008. Maybe that will happen again, but hasn't happened yet. Just because it happens once it doesn't mean it will happen again and that even if it happens again, doesn't mean that the response will be the same. The sky is still blue and birds fly through it.
Just a little... Taking a little outta Europe fund and putting it in Japan. And my conservative S&P fund is a little tech heavy: gonna focus on more equal weighting on the S&P companies.
Hoping to get a few more CA Muni bonds due to higher rate. Of course current bonds sell at discount right now...
But basically staying the course. To me it's simple; if you have to make much of a change to your portfolio you have the wrong portfilio and you are getting bad advice.
