Inflation

Discussion in 'Markets & Economies' started by mmm....shiney!, Jan 16, 2021.

  1. Michael Kay

    Michael Kay Active Member

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    Housing, or debt? Rising IR makes properties cheaper, not more expensive.

    Don't confuse homeowners with debtors, the latter will get wiped out. Time to buckle up and reduce exposure to debt.
     
  2. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Rising interest rates may make housing more affordable for those that can afford to purchase, for those already owning and those who can't afford to purchase it makes housing less affordable.

    Both homeowners and debtors are at risk of getting wiped out and reducing debt may be appropriate for only a small percentage of the population.
     
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  3. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    Im sure its just a big accident. Simply unprecedented.
    No one could have ever seen this coming.
    At least the sheeple can rest assured that the Fed is on their side.
     
  4. Lovey80

    Lovey80 Well-Known Member

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    How does one inflate/deflate private currencies and who holds the lever on when to inflate/deflate?
     
  5. Lovey80

    Lovey80 Well-Known Member

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    I am wondering. If someone was sitting on a 300-750k home loan right now. But had the lot of it or close to the lot off it offset with cash so that they were paying very little or no interest over the next two years. What would be the best opportunities moving forward? Could there be some seriously good buying opportunities in realestate coming up?

    Similarly, if this inflation and the resulting interest rates cause a recession. Could there be some serious buying opportunities of companies and small businesses coming up that could still retain decent cash flow but are over indebted right now and 7% interest rates could crush them?

    those sitting on easily accessible cash right now, especially if some of it is stored in USD could have some very solid investment opportunities moving forward.
     
  6. 66rounds

    66rounds Well-Known Member Silver Stacker

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    They would be few and far between in my opinion. Best of luck to you if you are in that position yourself
     
  7. heartastack

    heartastack Well-Known Member Silver Stacker

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    We’ve seen a lot of old food manufacturing plants and premises come on to the market in the last year and there are sure to be more. Also noticed that shrewd accountants will ‘fatten the cow’ by keeping assets on the book like equipment that are listed with inflated values (like they could be worthless pieces of junk and are valued as near-new).
    I think there will be some stellar deals but you need to do thorough due diligence for the relevant industry or area I guess
     
  8. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Private currency issuers using capital provided by investors. Value is adjusted algorithmically based on inflation data, baskets of goods etc.
     
  9. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    https://www.cnbc.com/2022/10/03/opec-oil-prices-could-soon-return-to-100-a-barrel-analysts-say.html

    Anyone still think inflation is because of accommodative monetary policy? :rolleyes:
     
  10. leo25

    leo25 Well-Known Member Silver Stacker

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  11. precious roar

    precious roar Active Member

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    Though depending on other factors, too.
     
  12. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Ok, I should have been more specific. :p

    The general trend long term has been downward pressure on inflation:

    Screen Shot 2022-10-04 at 11.33.09 am.png

    Short term as we all know can be chaotic:

    Screen Shot 2022-10-04 at 11.37.06 am.png

    https://www.macrotrends.net/countries/AUS/australia/inflation-rate-cpi

    Mainstream media of course exists in the chaotic short term. With every thing. ;)
     
  13. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    Yep definitely too much fiat debt created.
     
  14. heartastack

    heartastack Well-Known Member Silver Stacker

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    mmm....shiney! likes this.
  15. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    That chart is manipulated to the downside with the new cpi formula mixed in. Its tainted.

    You cant change a formula halfway through but continue the same chart. Thats just another manipulation.
    No one is that ignorant.
     
    Last edited: Oct 4, 2022
  16. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    That's a fallacy, Tucker Carlson is strong in you. ;)

    Of course you can. Changes to the calculation method are made to reflect the changes in household consumption patterns as the economy evolves and new industries emerge. It would be pointless measuring CPI in 2022 with a basket of goods from the 70's, unless flared jeans and 45s were still in vogue I guess. :p

    Over time household spending patterns may change but the effect of inflation upon consumer behaviour remains the same, hence the historical chart (data) is accurate enough for comparison purposes even when the ABS reviews the indexes and amends the historical data if required.
     
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  17. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    No you cant change the way its counted halfway through just to affect the overall outcome sorry. It doesn't hold water. Nice try but it's not reality. It doesn't even show real inflation numbers.
    Did you get that from Cathy woods tech site?
     
  18. leo25

    leo25 Well-Known Member Silver Stacker

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    We live in a global market, so to be relevant we need a global inflation chart that tracks true cost of living and not ones that exclude things like housing etc... Can you imagine if they did the same thing in science, saying we don't like how there is a gravitation pull in that region of space so we will just ignore it so we can maintain our current theory. :p

    Remember developed western countries have have had the ability to export inflation to other countries. China for example has acted as a massive sponge.
     
    Last edited: Oct 4, 2022
  19. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Housing (house prices) is not a consumable, it's an asset so the data is not included in the consumer price index just as share prices aren't for example. Housing construction and rents are though. Inflation data is useful to central planners, if there is a need for a global index then it would be as an adjunct to the various national databases as markets vary from country to country depending upon the style of economy.
     
  20. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Whatever you reckon.
     

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