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Thread: Negative Interest Rates....

  1. #81

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    Quote Originally Posted by RandomMan06 View Post
    We more or less agree on the "enemy". But i would not describe them as smart. I'd rather say ruthless, heartless and even stupid. Stupid because they don't see the long term risk/consequence. At best they ignore it, but i actually think they are just too stupid, ruthless and greedy to get it.

    I'm not sure i got how the inelasticity of the service sector is their Achilles' heel. Besides i think it is quite elastic although it has a hard upper bound unless you import more people. Which they solve with immigration as you pointed out

    In my previous posts I just wanted to point out how consumer-price-inflation might lag a lot behind all these currency injections and instead inflate assets like stocks/real-estate/bonds and so on. Assets which i claim will accumulate on the top and increase the divide given these policies. The middle class has to work even harder to get hold of these good assets, which combined with the elasticity of production of goods will slow CPI even further.

    But it's just me rambling as always. Not much new. Unfortunately.
    I just use intelligent , without a moral judgement Just their use of tactics to achieve their ends. I am sure they feel that we are the stupid ones and that they will not fail in achieving and maintaining their ends.
    I use services because they generally require persons to provide them, stable person, waitress, airline stewardess, janitor, gardener. child care, hairdresser, personal care worker. nurse, plumber, firefighter, policeman etc etc. They are harder
    to automate, harder to get more of, even with immigration, as there is a limit. It is also one of the most likely flashpoints ( state enabling non residents from low wage countries in to make sure wages stay low in service sector).
    So far the globalists have been relatively successful, in all the G7 countries except Japan, possibly.
    Consumer goods on the other hand can be increased significantly and quickly, by just ramping up production, domestically or outsourcing. So no problem for Globalists here.

    I am not convinced inflation will not resurface at some point in the near future. As pointed out it could be due to a lot of things, but I suspect it will be political in nature.
    It could also be a simple increase in V of money, and the inability to change the total goods and service output fast enough. One thing we do know is that they will not be able to fight
    inflation with the CB`s. It would destroy the patient. They are locked into never letting it get past 2 or 3 per cent. They could simply lie, but that would only work for a very
    short time if it got above a certain range. Deflation is not probable ( I agree with them) as they can print forever, or if that did not work, control the supply of goods and services.

  2. #82

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    Yes, i do also fear inflation. And it will probably come suddenly, without warning, when the masses suddenly realize what is being done to their savings. Yes, CBs will have an impossible choice if this happens.

    I'm afraid we agree too much on these issues to have a fiery debate..
    Last edited by RandomMan06; 05-26-2020 at 06:05 PM.

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