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Politics : Welcome to Slider's Dugout
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To: jim_p who wrote (15025)2/3/2009 11:21:22 AM
From: Fiscally Conservative1 Recommendation  Read Replies (1) of 50417
 
"My guess is the new administration along with the new Congress will pass some strong tax incentives for buyers of new, foreclosed and used houses in the first quarter which along with the long term rates now below 3% will lead to a rapid recovery in the housing market.

This will result in a shift from deflation to high inflation sometime in the first half of 2009.

In an inflationary environment you will need to look to the 70’s to see what to invest in.

In the 70’s recession led to lower earnings and inflation led to the PE of the S&P 500 going from 16 to 8. My guess is the same will happen again over the next decade or longer once we get past the deflationary thinking and stock index funds and bonds will not be a good place to invest. In addition the baby boomers retiring along with the higher volatility in the markets will result in more money leaving the markets over a sustained time period.

The best investment ideas in 2009 will be gold, oil, oil service stocks and alternative energy stocks with exposure to wind, nuclear and tar sands."

Message 25217587

It appeared you were an advocate of an inflationary environment. If your view has changed with this regard could you explain in detail why?
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