SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Pastimes : Clown-Free Zone... sorry, no clowns allowed
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Bid Buster who wrote (207252)11/29/2002 12:21:34 PM
From: Perspective  Read Replies (3) of 436258
 
BOTH deflation and inflation are happening simultaneously. Deflation primarily affects finished goods, as it is a result of excess productive capacity. The Fed's response to the finished goods deflation has been to jam the money supply. While this is virtually ineffective in producing increased profitability for corporations and higher employment, it *does* jam hard asset prices higher - real estate, gold, and commodities.

So, expect BOTH deflation *and* inflation for the forseeable future. Realize which is happening where and you can profit from it. Stick to buying commodities with low capital content (gold) and short corporate equity, especially where there is high capital content (semiconductors etc.)

I would avoid playing real estate, since it is one of the most highly levered assets in the world. Ultimately, deflation will come to that sector as well, just not sure when. Tell me when the unemployment rate goes up another 1% and mortgage rates stop falling, and you've got it.

BC
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News