separating fact from fiction

so we're talking the type of unprecedented scenario where every fiat currency fails more or less at the same time? even those of countries with very little in the way of debt and external financial services?

Only ONE currency has to fail and all the rest will turn to dust with it....the USD.

It has nothing to do with debt and external financial services. It has everything to do with immediate loss of faith in the ponzi fractional monetary system currently in place just about everywhere in the world, regardless of what colour the money is in, or whose portrait is on it.

so your whole thrust is based on a huge psychological presumption about something which has never happened before. if it has nothing to with debt how are you suggesting the dollar will fail in the first place?

massive overreach.

Is the unprecedented entire global banking system insolvency an overreach?

Are the unprecedented $700 trillion is derivatives floating about the financial system an overreach?

Is the unprecedented massive debt overhang in developed economies an overreach?

Are the unprecedented $1.5 trillion a year USG government deficits an overreach?

Is the unprecedented $120-200 trillion (depending whose number you want to believe) USG debt, including their unfunded liabilities, an overreach?

Are the globe's most major central banks unprecedented money easing programs (yes, the ECB is printing too) an overreach?




You are looking at the world through old paradigms, that's why you find everything confusing and refuse to accept the ugly reality.

They may be policy/financial overreaches. But they aren't predictions. Those are close to being facts (clearly not every bank on the planet is insolvent and therefore the entire system isn't insolvent, the 2012 deficit is supposedly smaller than 2011 one, etc. but I accept the general proposition). I agree I'm looking at a new paradigm. I accept the reality. Therefore I find conclusions as supposedly definite as yours absurd.

You are saying you know how everyone will act faced with a new paradigm that most folks (including me as you oddly assert) haven't realised exists. That's madness.

There may be some planet somewhere deep in the universe where the logic in your post may make sense, just not here on earth.

clearly not every bank on the planet is insolvent

How the feck would you know? Seriously, how the feck would you know with mark to fantasy accounting and off balance SIVs? How the feck would you know who carries what obscene leverage and what quality collateral they have?

All the majors are insolvent. Look who is getting bailed out and why? Look who can pledge worthless toilet paper as collateral and get unlimited money at 0pc interest. And financial system interconnectedness will take EVERYONE down.

the 2012 deficit is supposedly smaller than 2011 one

If you didn't have the word "supposedly" in there, I'd beat you over the head for this, but you did so I'll give you a pass. It's higher, not lower, research it before you post.



Yeah, it's madness, we're way beyond madness, it's just that you haven't clued in yet.

How the feck would you know?

how the feck would you know they are all insolvent down to every last credit union? many banks don't use fantasy accounting and off balance SIV's.

anyway that's beside the point. you've just addressed the aside of the section where i was largely agreeing with you. you haven't addressed the bit that nailed you:

You are saying you know how everyone will act faced with a new paradigm that most folks haven't realised exists.

without any historical evidence since this is an entirely new paradigm.

This is how I know:

http://research.stlouisfed.org/fred2/series/M2

http://sdw.ecb.europa.eu/browse.do?node=2120792

Who the deck do you think the money is going to, healthy solvent banks? Or, do you think the handful of solvent banks/credit unions are going to be left standing if the majors go down?

The global banking system is insolvent. The main reason you continue to post the pointless rubbish you put up here is that evidently you still haven't clued in.

As for the rest of it, you know the point you "nailed me on", obviously posting that your logic may make sense somewhere in the universe but not here, in reference to your convoluted logic, went right over your head.

What the feck is your point anyways?

Don't bother answering that, it makes me boil that people living in la la land like you, you know, the one without inflation, get one vote just like I do.

deck = feck

Who the deck do you think the money is going to, healthy solvent banks?

nope. that's why the result hasn't been much retail price inflation.

my point went over my head? you do talk some twaddle

so your evidence for knowing what will happen in an unprecdented situation is that the money supply has expanded at a certain rate. either this has a precedent in which case it presumably doesn't point to hyperinflation in the US or it doesn't in which case you are making a massive assumption. your evidence isn't telling me anything i didn't already know.

What the feck is your point anyways?

that you prognosis of future hyperinflaiton is based on assumptions of unprecdented behaviour which you are necessarily unable to back up with evidence. you've had a guess

it makes me boil that people living in la la land like you, you know, the one without inflation, get one vote just like I do.

the irony is that you could find few more fiscally conservative minded voters than me, i don't approve of all this QE nonsense, the banks should never have been guaranteed in the first place, etc. but apparently only people who believe a hyperinflationary apocalypse is around the corner should get a vote.

if you could be handed the reins of government in the uk now what would you do (aside from telling the populace that they were clueless plebs repeatedly)?

that's why the result hasn't been much retail price inflation

Yeah, you got me there, if we remove energy, fuel, food, medical, education, insurance, taxes and an assortment of other fees, inflation has flat lined // sarc.

Stop eating burgers and buy second hand clothes at the Salvation Army....then you wouldn't been spewing nonsense about there "hasn't been much retail inflation"

so your evidence for knowing what will happen in an unprecdented situation is that the money supply has expanded at a certain rate. either this has a precedent in which case it presumably doesn't point to hyperinflation in the US or it doesn't in which case you are making a massive assumption. your evidence isn't telling me anything i didn't already know

Like I said before, there might be a planet deep somewhere in the universe where this logic may make sense, just not here on earth.

that you prognosis of future hyperinflaiton is based on assumptions of unprecdented behaviour which you are necessarily unable to back up with evidence. you've had a guess

Would an email directly form Ben Bernanke laying out his intentions satisfy you? Because if not, it's unlikely any evidence I could offer you would suffice, considering you are so out of touch you don't even see regular inflation taking hold.

fiscally conservative minded voters than me

Does being fiscally conservative include abusing the system and having more babies, not for the sake of building a family but just because it can be good business receiving government credits? I'm not making this stuff up, you posted and even bragged about it on this forum. You shouldn't get a vote because you are a leech, feeding off the tit of the nanny state.....at my expense.

if you could be handed the reins of government in the uk now what would you do (aside from telling the populace that they were clueless plebs repeatedly)


Explaining how the government manipulates the inflation numbers they report would a good place to start.

charlatan, look at the exponential growth of the market indices since the early 1980's, that's when the house of cards came under construction, it was surely only ever going to be 'when' not 'if' the thing came crashing down. The catalysts of the past few years have exposed the charade for what it was / is. You are right that we have not faced anything like this before, how do you think the west is going to handle living in poverty for the next few decades (genuine question)?

charlatan fades in and out of here but has always continued to spew "there hasn't been much price inflation" every time he shows his face. He said that when the official price inflation was reported at 2pc+, then 4pc+, then 5pc+, and he is still saying it now. He is drawing his conclusions on observations from a statistical sample of one, himself, the most dangerous sample in empirical analysis.  But on the other hand, perhaps who's to blame him when both King and Bernanke deny the existence of inflation.

He should ask King the following question: UK National Statistics changed the way inflation is calculated six times since 1991 (91, 95, 98, 02,03, 07). We usually follow the American recipe for cooking the numbers with a 12-18 month time lag. With the exception of the 02,03 changes that re-calibrated the model (not substantive), what changes were made the other four times, and why? What would the reported inflation be today if the 91 methodology was used?

He should also ask Bernanke the following question: Recent data showed that the US consumer has re-leveaged into the end of 2011. Retail sales however remained basically flat for December (traditionally the strongest retail month of the year), the weakest month in seven months, and in negative territory if you strip out car purchases essentially supported by subprime loans. So, if there's no inflation, and consumers are not buying, but they are again borrowing more, where the feck is the money going?

Then he should ask himself this question: Could I be wrong?

Menelaus, "if you could be handed the reins of government in the uk now what would you do (aside from telling the populace that they were clueless plebs repeatedly)"

This is not a poltics thread. It might be very wise poltics to use the mushroom method of government. This invlves keeping everyone in the dark and feeding them a load of cr@p at regular intervals.

It might be politically and pragmatically right to avoid saying anything that would frighten the horses, the servants and other human beasts of burden. Actually if we are to be managed down to a low standard of living economy and leveled down to far eastern expectations of life over the coming decades poltically it would be wise not to say so.

Frankly and politically I think that exactly is what is to be done because we are living beyond our means. And "means" are not comimg back.

Be as potive and optimistsic as you like. But many on here are intersted in truth and are against politics or wishful thinking if it interfere's with truth, facts and reality.

Stop eating burgers and buy second hand clothes at the Salvation Army....then you wouldn't been spewing nonsense about there "hasn't been much retail inflation"

hmmm....i'm a lifelong veggie and i hardly ever buy new clothes beyond footwear and underwear. if your assumptions about me are so flawed how am i supposed to trust your predictions about how everyone else will act in an unprecdented situation?

Like I said before, there might be a planet deep somewhere in the universe where this logic may make sense, just not here on earth.

lol. you play the i don't understand card regularly when soemone nails you.

Would an email directly from Ben Bernanke laying out his intentions satisfy you? Because if not, it's unlikely any evidence I could offer you would suffice, considering you are so out of touch you don't even see regular inflation taking hold.

not really because it would end his tenure pretty swiftly.

Does being fiscally conservative include abusing the system and having more babies, not for the sake of building a family but just because it can be good business receiving government credits? I'm not making this stuff up, you posted and even bragged about it on this forum. You shouldn't get a vote because you are a leech, feeding off the tit of the nanny state.....at my expense.

firstly i am building a family because i want to do so. given the drain on time one would be daft to have a kid simply to turn an extra couple of grand a year. i'm not a leech. i'm claiming what i'm entitled to claim even though i think the entitlement is stupid and have never voted for the party which introduced it. if i were a leech i would have arranged my finances so that i was in receipt of housing benefit, council tax benefit and the rest of it but instead i'm conservative with my finances and have saved so i'm not entitled to any of that (and may find that kids no longer run at a profit some time after the not universal credit is introduced). i want independence from government, not dependence on it but i'll take any free (to me) money they throw at me. i have always taken the same attitude with my parents (who give me bugger all until they die). that you have got yourself into a position where you pay a higher proportion of your income in tax than me is none of my concern. your decisions got you there. but i think that incrementally everyone should pay less tax, benefits should be slashed, as should much of the rest of government spending.

Explaining how the government manipulates the inflation numbers they report would a good place to start.

but nowhere near enough. set up your own inflation measure. but then what?  have another go. how are you going to fix the nation's finances?

look at the exponential growth of the market indices since the early 1980's, that's when the house of cards came under construction, it was surely only ever going to be 'when' not 'if' the thing came crashing down. The catalysts of the past few years have exposed the charade for what it was / is. You are right that we have not faced anything like this before, how do you think the west is going to handle living in poverty for the next few decades (genuine question)?

muqbil, it hasn't exactly been exponential but i know what you're getting at. i'm not saying all in the garden is rosy. all i'm saying is that menelaus is unable to back up his assertions about the inevitability of hyperinflation within some meaningful timeframe (i.e. beyond the old canard that it happens to all currencies eventually). when pushed to make predictions a few months ahead about inflation he resorted to claiming 5% was massive to save face yet somehow he reckons we should all accept his wisdom when he asserts that he knows how everyone well behave in an unprecdented situation.

how do i think the west is going to face it? by pretending it isn't happening as melv suggests. by hoping there's enough growth through technological advances (interesting to read elsewhere that menelaus thinks the lack of oil is going to finish us off.....talk of this type comes up every so often for one reason or another but ingores the progress that occurs even in relatively dark times like these) that we can flatline for yonks. it's going to be a slow process. no doubt they would like a bit of inflation to smooth the course for them but what if they can't create it without the helicopter? menelaus thinks they'll create hyperinflation (against their own interests). i'm not buying that that happens any way other than accidentally. it doesn't make sense as a strategy.

charlatan fades in and out of here but has always continued to spew "there hasn't been much price inflation" every time he shows his face. He said that when the official price inflation was reported at 2pc+, then 4pc+, then 5pc+, and he is still saying it now. He is drawing his conclusions on observations from a statistical sample of one, himself, the most dangerous sample in empirical analysis.  But on the other hand, perhaps who's to blame him when both King and Bernanke deny the existence of inflation.

nope. i'm drawing it from my experience, the experience of other s know and the official statistics which don't seem wilidly out of whack. if you wan tto ttell me that rpi or cpi underestimate inflation some relatively small degree i'm happy to accept it for the sake of argument but you keep making wild claims without any real evidence to back them up. as for your 2%, 4%, 5% series are you suggesitng that inflation is still rising (what you have in the past incorrectly called accelerating)?

He should ask King the following question: UK National Statistics changed the way inflation is calculated six times since 1991 (91, 95, 98, 02,03, 07). We usually follow the American recipe for cooking the numbers with a 12-18 month time lag. With the exception of the 02,03 changes that re-calibrated the model (not substantive), what changes were made the other four times, and why? What would the reported inflation be today if the 91 methodology was used?

i'd like an answer to that. i suspect it would be a bit higher but it wouldn't be the massiv einflation you predicted.

He should also ask Bernanke the following question: Recent data showed that the US consumer has re-leveaged into the end of 2011. Retail sales however remained basically flat for December (traditionally the strongest retail month of the year), the weakest month in seven months, and in negative territory if you strip out car purchases essentially supported by subprime loans. So, if there's no inflation, and consumers are not buying, but they are again borrowing more, where the feck is the money going?

since bernanke isn't answering my calls today why don't you give me the answer?

Then he should ask himself this question: Could I be wrong?

i can't be right. but i'm not making any grand prediction. if i could make infallible predictions about the direction of the economy i would be in great demand. which is why it seems so odd that you are so confident about a seemingly outlandish prediction even when it has been made clear that your reasoning is largely based on assumptions about human behaviour in unprecedented stressful situations.

The issue is much bigger than "we are living beyond our means", and it's certainly beyond any politician and central banker to solve it. They can kick the can down the road trying to buy time before an inevitable (and made much worse by trying to delay it) collapse comes, but there's absolutely nothing they can do to avoid it.

The fiat money system was designed with an end date. Epic greed by the friends of the banking cartel creating fictitious paper wealth at a pace outpacing real organic economic growth by multiples (so that they can pay themselves massive bonuses), combined with the disappearance of cheap oil (necessary for the exponential growth required in the real economy to prevent the debt based system from collapsing) have brought the system to its end a few days earlier.

Everyone is printing (FED, BoE, ECB, BoJ, PBoC), both overtly and surreptitiously, to try to kick the can down the road. They are flooding the massively insolvent banking system with liquidity, accepting worthless garbage as collateral, in effect making themselves the "bad" bank. The FED is leveraged 50/1. The BoJ is leveraged 100/1. The ECB (the only one that by treaty can not print money out of thin air - although they are now doing it covertly through other schemes) is technically insolvent and leveraged almost 500/1. And despite all this unprecedented and previously unthinkable action, four years into this crisis, things are getting worse, not better. And then there's that nasty Oil thing where geology, porosity and flow rates thump finance.

How long do you think they can keep doing this?

i'm drawing it from my experience

I've been down this road before with you, I'm starting to lose my sense of humour. You still just don't seem to get it.

You don't own a home, you rent. That means you need not worry about some significant costs related to owning a home that someone like me is facing. They are very real, very significant and have all gone up way more than the government stated inflation. You don't own a car, no need to worry about fuel, insurance and maintenance cost increases, not to mention numerous other nasty surprises like an increase in licensing, parking, and traffic violation penalties. I have no idea if you even have a job, or the nanny state is just sending you the money they confiscate from me to just stay home in return for your vote. If you did have a job, you'd probably  be complaining about rail and other commuting related expenses going up like everyone else lately. I have no idea how you feed and clothe your family nor what kind of education you are providing for your children, but I can tell you my costs have risen significantly. I can go on and on, but I think you get the idea.

You are drawing conclusions from the most dangerous sample in empirical analysis, a sample of one. Ostriches may only see sand when they bury their heads, that doesn't mean the world is only made of sand.

i'd like an answer to that. i suspect it would be a bit higher but it wouldn't be the massiv einflation you predicted.

Since you are too lazy to investigate and find out the answer yourself, let me answer that for you. The answer is 18pc. Which shouldn't surprise anyone who understands that real inflation is now running close to 10pc. After all, I still prefer to feed my family with beef tenderloin and not substitute with ground pork so that I don't "inflate" my household expenses.

You need to reassess your understanding of the word "massive"

i can't be right. but i'm not making any grand prediction. if i could make infallible predictions about the direction of the economy i would be in great demand. which is why it seems so odd that you are so confident about a seemingly outlandish prediction even when it has been made clear that your reasoning is largely based on assumptions about human behaviour in unprecedented stressful situations

You still don't get it, do you?

I stand corrected. I consulted my files and price inflation using 91 methodology is running at 14.2pc, not the "off the top of my head" 18pc posted above. Still pretty massive by anyone's (except charlatan's) standard.

The point Menelaus doesn't get is that he doesn't know what is coming, he just thinks he knows.
Now he may well turn out to be right, but the jury is still out.
So you can proceed on the basis that his verdict is inevitable, and plan accordingly, or do nothing or do something moderately in between.
But the choice is yours, and you are not axiomatically stupid if you choose the latter routes.
If you're currently relatively poor, you will probably do nothing, if you're currently very wealthy you will react moderately, if you're in between some will react in the Menelaus fashion and others will hope that the policy makers can get us out of this hole.
And that is is exactly what the markets are signalling at the moment. There is no universal opinion on what is going to happen.

You don't own a home, you rent. That means you need not worry about some significant costs related to owning a home that someone like me is facing. They are very real, very significant and have all gone up way more than the government stated inflation. You don't own a car, no need to worry about fuel, insurance and maintenance cost increases, not to mention numerous other nasty surprises like an increase in licensing, parking, and traffic violation penalties. I have no idea if you even have a job, or the nanny state is just sending you the money they confiscate from me to just stay home in return for your vote. If you did have a job, you'd probably  be complaining about rail and other commuting related expenses going up like everyone else lately. I have no idea how you feed and clothe your family nor what kind of education you are providing for your children, but I can tell you my costs have risen significantly. I can go on and on, but I think you get the idea.

You are drawing conclusions from the most dangerous sample in empirical analysis, a sample of one. Ostriches may only see sand when they bury their heads, that doesn't mean the world is only made of sand.

i made it clear above that i wasn't doing that. please read what i write before launching into your repetitive diatribes. please tell me which of the above costs that you are foolish enough to run up while i sit at home gambling on the internet for a living and preparing to homeschool my kids (one to one tuition from two parents much clever than your primary school teacher can't be too bad) you reckon has gone up by this 14.2% figure. perhaps, just perhaps (if we accept that you didn't just pull this figure out of your arse like most of your assertions), it demonstrates that the 91 methodoology ain't fit for purpose (which you seem to agree about, claiming that real inflation is less than a less than massive 10%).

the only expense i can think of which went up by 14.2% last year was electricity and they've just cut mine by 5%. heating oil went up quite a lot but less than 14%. nothing else (aside from odd foodstuffs) came close. council tax unchanged, rent unchanged, house prices slightly down, mortgage rates going nowhere much, food up a bit, booze up a bit, train prices up by less than half of 14% (not having a car and living in the country i'm well aware of public transport costs), bus price unchanged, etc. if house maintenance has gone up they could try to pass it on in rent but that ain't happening. the boe personal inflation calculator suggests i'm faring a little better than average but not by the outrageous amount you seem to think. i keep track of my outgoings and they have indeed risen by around the stated personal inflation figure. no one i've met has claimed that inflation is in double figures although i've read a couple of numpties claiming that here and there on the internet.

if i were you i wouldn't bleat too much about being more affected by inflation than me. it looks like you made worse predictions about future costs in the past....

the bad news is that at some point in the future betfair commission+pc is going up to over 60% for me at which point i'll be better off getting a modest job (not that anyone is likely to give me a good one after over a decade of gambling) and paying a relatively small amount of tax.

How long do you think they can keep doing this?

no idea. something has to give eventually as per the euro crisis. but you have given no plausible reasoning as to why hyperinflation will be the inevitable result. so should i believe you or the collective wisdom (which sometimes doesn't amount to much) of the markets? occasionally i've been right, felt fairly sure and been on the right side of the market. but occasionally i've been wrong. i've never been as sure as you seem to be even on a short term up or down scenario. yet you are claiming to be this certain about how folks will act in an unprecdented scenario. bewildering arrogance seemingly backed up by arrant nonsense. back it up or be on your way......fafh is fairly close to the mark here.

The fiat money system was designed with an end date.

what's the date then?

no idea

The only two words in your entire post that truly describe your understanding of the inflation/deflation debate or what this crisis is really all about.

while i sit at home gambling on the internet for a living and preparing to homeschool my kids

Good luck with both. I can see already they have a bright future ahead of them. Unfortunately I'm willing to wager a lot of money, it's my kids that will pay the bill for yours in the future, just like I'm picking up the tab for you now.

back it up

I have, it's that you're not paying attention. You will in the fullness of time, these things that I'm harping about have a way of asserting themselves whether you get it or not.


Feck, I'm still boiling someone like you gets one vote just like I do.

The only two words in your entire post that truly describe your understanding of the inflation/deflation debate or what this crisis is really all about.

why spend so much time talking about what i think (which supposedly has no value) when you could work on a coherent explanation of your opinion instead?

Unfortunately I'm willing to wager a lot of money, it's my kids that will pay the bill for yours in the future, just like I'm picking up the tab for you now.

so you're going to teach them to be mugs like you. if my kids are ambitious (unlike me) i'd suggest they move to another country so i doubt it would be the other way around. cheers.

what this crisis is really all about

is that the central banks have manipulated the money supply to avoid a big significant recession so many times will ever decreasing degrees of effectiveness and now they've run out of firepower to do much about it unless they resort to the stupid. you assume they will. i don't.

i see you have no end date so that was another assumption.

I'm still boiling someone like you gets one vote just like I do

so who do you vote for if your vote ought to be so much more valuable? you obviously can't vote for the major parties (as i tend not to) and i'd be surprised if you vote for socialist parties (which i don't). it would be quite ironic if we voted a similar way yet you kept spouting this drivel. you should be glad i have a vote. i'm probably closer to you politically than the vast majority of the population. anyway knowing that your vote can only have an expected value of a fraction of a penny even to a supposedly rich man like yourself i'm surprised you give two hoots. you seem to give way to anger very easily. chill out: it may extend your lifespan.

you could work on a coherent explanation of your opinion instead?

I dumbed it down as much as I could. You're on you're own from now on.


so you're going to teach them to be mugs like you

I don't think so. I'll just teach them that staying home gambling on the internet whatever money the nanny state sends someone is for losers. Not quite the role model someone should be for their children.

unless they resort to the stupid. you assume they will. i don't

They already have resorted to the stupid, continue to resort to the stupid and will continue to resort to the stupid because there is no other way. Just because you don't see it, that doesn't make it not true.

you seem to give way to anger very easily. chill out: it may extend your lifespan

Creating wealth for my children will extend my lifespan, not chilling out. Call it an idiosyncrasy of mine, making a living gambling on the internet and chilling out is not quite the legacy I want to leave my children.

I'll just teach them that staying home gambling on the internet whatever money the nanny state sends someone is for losers. Not quite the role model someone should be for their children.

i'm not gambling the money i receive from the state. deposits are not required. the money from the state is saved to provide security for my children. i don't seek to fill them with puerile notions of winners and losers though. that way lies i wanna be a pro footballer, i know how the world economy will pan out and other egotistical drivel. i prefer to instil them with more measured thinking and hope they end up a tad calmer and more polite than you to boot.

Just because you don't see it, that doesn't make it not true.

just because you say something doesn't make it true. in fact since you've said made mcuh elss bold predictions and come in stuck to would be madness to follow you just on your say so. you repeated assertions, are just that. assertions. bugger all reasoning. and faced with a couple of lines of reasoning you either ignore it or claim not to understand it.

Creating wealth for my children will extend my lifespan

how?

Call it an idiosyncrasy of mine, making a living gambling on the internet and chilling out is not quite the legacy I want to leave my children.

but spending yonks spouting drivel on a betting forum is?