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overtheedge
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6 Myths of Inflation

- Jason Hommel - Silverstockreport

#1 Tacit agreement although food production and distribution will be drastically altered requiring substantial personal stockpiling. This is not going to be a weekend long event. Highest probability is 1 year (a winter and a growing season) of widespread shortages and intermittent distribution.

#2 Agreed

#3 Agreed

#4 Disagreement. You fell into the same trap I did over the Fed's definition of deflation. The Fed's deflation describes a severe reduction in debt instruments outstanding. Effectively, interest income sharply declines due to reductions in personal and corporate debt. The Fed's number one responsibility is to bank profiteering.

However, if we consider deflation from the viewpoint of quantity of money, uh-huh. Reducing the quantity of money is not a possibility when Congress is in session.

#5 Complete agreement

#6 The premise is false, ergo all that follows is false. The money supply (gold and occasionally silver) grew substantially during those years. The US experienced several gold rushes as well as the silver strikes which prompted bimetallism legislation.

The statement about a man's suit was much wider than I was taught: a man's tailored suit.
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The remainder of your commentary is logical.

I would ask, in light of what methodology goes on for a college education, why not spend the money on self-education and then use the remainder to start (and probably fail) a business. Learning by doing has repeatedly proven itself as the most complete educational experience. Supposedly a Harvard MBA is a study in other's failures. First hand experience is invaluable and helps the economy.

I would argue that we are watching the death of the artificial middle class that could only exist in an inflationary environment. For most of recorded history, who was the middle class? It was the merchants and producers. It was NOT the hired help.

When the price of gold and silver takes off, people will experience great difficulty in obtaining it and only with delivery delays that may last several weeks. Those who possess physical in hand could pay for a confirmed order for delivery and sell part of on hand. And then gleefully dance the contango three-step. Buy low - sell high - pyramid profits. In the end, wealth will be measured by weight and metal content; ounces and grams of silver and gold. PGMs will be in very limited demand.

Commented 3901 days ago

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Beginning of the headline :1. As the currency goes down, everything else goes up at roughly the same rate. Not true.2. The law today will be the law tomorrow during hyperinflation. Not true.3. I'll be able to ride it out here in the back woods of Colorado or Alabama during hyperinflation. Maybe, and maybe not.4. There is no risk of inflation when the bigger risk is deflation. Not true.5. The dollar will not go down in value, because everyone who owes dollars has a short position on the dollar that must be covered... Read More

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