argentina was a flight, in desperation, to a set of assets... that may well become as dysfunctional as the money invested in those assets, not to mention the devaluation of the return on investment. jury is out, but verdict is grim...
inlflation... that assumes prices can be raised in a climate which allows end users to absorb the increase...
what if that's not true in this instance, and becomes the straw breaking the camels back? after all, it is a false liquidity that has fed the debt bubble, and that debt has already been absorbed at the consumer level beyond coping... is inflation then the consumer's breaking point?
job loss? and a cascading set of dominos?
the extremes don't allow, IMO, a normal x y z approach..
the question is not inflation. the question is, maintaining the status quo, i.e. balance. tip that scale and your lurch unwillingly off the cliff.
dollar is a great signal at the moment perhaps.
had the argentines put their money in gold a year ago, many would be happier than they are today.... the market alternative of hard operating assets is doubtful at best should those assets prove softer than assumed in their desperation, let alone the depreciation of their return in peso terms.
J |
