i believe that it's a very good time to learn about commodities as well. and i know little about them myself, so that's why i'm hoping people like you will post good articles relating to them here so we all can learn. we are going to have to switch to hard assets in the coming decade to protect ourselves from central bankers and fiat money. thanks for stopping by. :)
i notice most everyone thinks inflation is not going to be a problem going forward. that tells the contrarian in me that inflation is the number one thing for me to focus on. a perfect example for a contrarian is how analysts used to talk about inflation in recent years, rarely mentioning deflation. now they all focus on deflation and can't imagine any scenario of runaway inflation. the consensus is rarely right and i expect them to be wrong once again on the inflation front. i see evidence of mounting inflation pressures all around us, including the true definition of inflation, unwarranted increases in the money supply. that inflation is going to drive up the prices for raw goods, not stocks and bonds, and that will be reflected in the kind of inflation that many people characterize as rising prices for consumers.
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Friday July 6, 2:41 pm Eastern Time
Disinflation, not inflation. focus for U.S. bonds
biz.yahoo.com
By Eric Burroughs
NEW YORK, July 6 (Reuters) - For the mercurial U.S. bond market, it turns out inflation is not so much of a worry after all.
Just a few months ago investors raced to dump long-term Treasuries, driving yields sharply higher on fears the Federal Reserve's aggressive rate cutting could spark a quick rebound in growth and raise the risk of ballooning inflation pressure. But as energy and other commodity prices recede, the dollar keeps rising and an economic slowdown frees up spare industrial capacity, few economists now see inflation lurking in the shadows even if U.S. growth picks up steam in coming months. ``The odds are that we've probably seen the worst on the inflation front,'' said Alan Ruskin, research director at 4Cast Ltd.
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In May, inflation as measured by the Consumer Price Index (CPI) rose 3.6 percent compared with the same month last year, driven near some of its highest levels in nearly a decade by the recent surge in energy prices. But the index remains well below the 6.4 percent pace registered in October 1990 -- the same month oil prices hit their peaks in the months leading up to the Gulf War. And core CPI inflation, which strips out volatile energy and food prices, stood this May at a more muted 2.5 percent -- well below peaks at 5.6 percent in February 1991, just as the economy was exiting its last recession. |
