The Scariest Blog Post I Have Read All Year

[robertpaulsen]

How Hyperinflation Will Happen

Most people dismiss the very notion of hyperinflation occurring in the United States as something only tin-foil hatters, gold-bugs, and Right-wing survivalists drool about. In fact, most sensible people don’t even bother arguing the issue at all—everyone knows that only fools bother arguing with a bigger fool.

A minority, though—and God bless ’em—actually do go ahead and go through the motions of talking to the crazies ranting about hyperinflation. These amiable souls diligently point out that in a deflationary environment—where commodity prices are more or less stable, there are downward pressures on wages, asset prices are falling, and credit markets are shrinking—inflation is impossible. Therefore, hyperinflation is even more impossible.

This outlook seems sensible—if we fall for the trap of thinking that hyperinflation is an extention of inflation. If we think that hyperinflation is simply inflation on steroids—inflation-plus—inflation with balls—then it would seem to be the case that, in our current deflationary economic environment, hyperinflation is not simply a long way off, but flat-out ridiculous.

But hyperinflation is not an extension or amplification of inflation. Inflation and hyperinflation are two very distinct animals. They look the same—because in both cases, the currency loses its purchasing power—but they are not the same.

more...

http://www.zerohedge.com/article/guest-post-how-hyperinflation-will-happen



So my big question is, can anyone refute the logic presented here? Are our Treasuries really that toxic? Is our deflationary situation really divergent enough from Japan's http://www.nuwireinvestor.com/articles/us-recession-could-be-worse-than-japans-lost-decade-52647.aspx">Lost Decade that we could end up following in the footsteps of the http://en.wikipedia.org/wiki/Inflation_in_the_Weimar_Republic">Weimar Republic? Certainly this scenario is possible, but is it plausible?

[SheilaT]

1. There are an awful lot of

if statements in the piece.

[robertpaulsen]

2. Well, let's start with the beginning of the author's presumed scenario.

Is the possibility of a "slight but sudden rise in the price of a necessary commodity, such as oil" leading to asset managers reducing their Treasury allocations to "go into the pressured commodity, in order to catch a profit" not plausible?

[SheilaT]

4. Have we not had

"slight but sudden rise in the price of a necessary commodity, such as oil" WITHOUT hyperinflation in recent years.

This is just more of the OHMYGOD EVERYTHING IS TERRIBLE THE SKY IS FALLING THE SKY IS FALLING WE ARE ALL DOOMED stuff we hear all the time. The blogosphere simply makes it possible for many more people to become aware of crap a lot more easily than before.

I suppose, on a theoretical level, hyperinflation could happen here. But I've been hearing predictions of dire doom pretty much my whole life, and so I'm extremely skeptical of most of them.

As a comparison, think about the fundamentalists who are totally convinced that the Rapture will occur any day now. And they've been sincerely believing that for at least forty years. Personally, I think the so-called Rapture is not something that is ever going to occur, mainly because my belief system does not include anything like that. I could be wrong. But I'm more than willing to take the chance. Because I, not to put too fine a point on it, think they are nuts. Similarly, those who constantly predict a complete and total melt down of our current economic and social system are, in my opinion, nuts.

You or anyone else may differ.

[zipplewrath]

9. The boy that cried wolf

As my little brother was fond of pointing out, ultimately the wolf did come. The problem with folks that scream "all is lost" too often, desensitize us when the conditions to form. The guy could be right, I just don't see the kind of numerical analysis that backs up his claims. There are huge amounts of treasuries out there, vastly more than the value of most singular commodity markets. Could they chase so many commodities to cause the hyperinflation he predicts? I dunno, but before I believed a proposition like this, I'd like to see some credible numbers put against the scenario. How many treasuries, from which holders, would cause what rise in which commodity markets? Would even a hyper inflated market pay those kinds of "bubble prices" for those commodities?

[Greyhound]

11. He laid that out in the blog. We are, far and away, the largest holder of U.S. Treasuries

and we are buying more every minute of every day to keep the machine going, and that can work provided that the machine is fixed and it is given the fuel to run. So far we have refused to fix the machine and are now cutting off the fuel supply.

[zipplewrath]

13. But he sits upon a three legged stool

1. The banks try to sell off their Treasuries, to buy something else (commodities). That's alot of commodities.

2. The fed can't buy up the treasuries (or there is in essence a run on the fed through treasury sales). Again, to buy what? Yes, one can believe that folks would want to unload treasuries, but not just to hold cash.

3. There are enough commodities to suck up all the cash. Yes, that's what the hyper in hyperinflation is all about, people spending "anything" for a commodity in order to get rid of cash. But there has to be enough commodity to sell, from willing sellers, to absorb that cash. At some point (as he suggests with the silver) it's the cash people are avoiding and they won't sell $3000 oil because it is the cash they are avoiding. When Germany had hyperinflation, there were other currencies to run TO. The US is a reserve currency, oil is priced in dollars. It's not like people are suddenly going to be buying euros, much less accepting them.

In order to be credible, he's going to have to explain how a RESERVE currency goes into hyper inflation. Has that ever happened before?

[Greyhound]

21. First, this is simply a speculation of what is now possible, but you've discounted the basis

for the premise, that faith in the USD has collapsed because of the irresponsible handling of this crisis. That the dollar has lost value because there are more of them than there are things to buy. Think of the derivatives pool* for example, it is an inevitable collapse that only fear of the consequences of that collapse is preventing from happening.

And remember that in the scenario it is not the resulting transactions hoped for by a sell-off (buying oil @$3K), rather the fed's automatic reaction at the start. And it all comes back to those 'toxic assets' remaining just as toxic and dealing with them in this one-sided manner.

As I said in another reply, whether or not this scenario occurs is not the point for me, rather it is imparting the knowledge that this can happen and why.


*current 'value' of ~12 times global gross product

[zipplewrath]

23. Well, again, the trigger depends upon the large sale of Treasuries

The intial reaction is based upon a large scale sale of treasuries merely because some investment houses want cash to purchase other securities (or commodities). It isn't clear that's what they'd sell in order to raise capital. It also then depends quite heavily upon the TBTF banks wanting to, and actually deciding to, sell off treasuries. Again, my question becomes, to buy what? I will agree there is a problem when too many dollars are chasing too few products. But right now, because it is a reserve currency, many of those dollars are in treasuries because they can't find anywhere else they want to be.

It's all possible in the qualitative sense, I just don't see how it is possible in the quantitative sense. But if irrationality gets into the markets, yes just about anything can happen. Admittedly, it's how the whole CD swap think happened, although much of that can be traced to ignorance as much as irrationality.

[robertpaulsen]

12. Certainly.

In fact where oil is concerned, we had a steep and sudden rise during the summer of 2008 that saw the spike hit $147 a barrel in July 2008. I remember because I made a bet on the now defunct DU Peak Oil Forum in 2005 that such a spike would occur. You are quite right that this did not result in hyperinflation then. I firmly believe that this spike was the straw that broke the camel's back, resulting in the Economic Meltdown in September 2008.

Things have changed since then and the author reflects those changes in the written post. What I am looking for here are rational arguments to counter his logic. While I certainly respect your opinion, to characterize his analysis as OHMYGOD EVERYTHING IS TERRIBLE THE SKY IS FALLING THE SKY IS FALLING WE ARE ALL DOOMED stuff is a little too dismissive for me.

[zipplewrath]

7. There's alot of presumption in there

It presumes that asset managers would sell treasuries to chase commodities. Is that what they would do? Is that what they've been doing? Treasuries are still considered, world wide, one of the safest places for your money. So would they sell off other assets first? Would the Chinese be the ones to start buying them, not the feds, because THEY want to shore up what they already have?

Unlike every other currency that he wants to draw a comparison, the US dollar is a major currency in the world. Other currencies are as "tied" (economically speaking) to ours such that when ours goes down, so does everyone elses. Yes, there could be a run on gold, or oil but they would begin to hit highs that would make them "bubble like" and would take pressure OFF of the treasuries. The german mark wasn't in that position, folks just went to other currencies. The Japanese yen was the same way. No on was going to run BACK to the yen when commodities got too high. But if the dollar gets way outta whack, there aren't alot of other currencies for people to run to, and they'll only run to metals, pork bellies and oil until THEY are perceived as a bubble.

There are risks for sure, and we are in very rough political and economic times. And we could see something along the line he is talking about, a concern by the TBTF banks looking to spread their risks around. But honestly, they don't have alot of places to go.

When all is said and done, I'm far more worried about deflation. But that's probably because I owe money. This guy is holding money, so he's worried about it.

[MilesColtrane]

8. "This guy is holding money, so he's worried about it."

Or, he's selling silver.

Who knows his motivations for a piece like this?

[robertpaulsen]

34. You give a lot of food for thought, zipplewrath.

I'll give you my take on your points:

It presumes that asset managers would sell treasuries to chase commodities. Is that what they would do? Is that what they've been doing? Treasuries are still considered, world wide, one of the safest places for your money. So would they sell off other assets first? Would the Chinese be the ones to start buying them, not the feds, because THEY want to shore up what they already have?

My logic here is that you are correct in implying that haven't been selling treasuries to chase commodities in the past. But in an environment where the Fed's specified goal of maintaining low yield Treasuries coincides with what the author describes as "the bond markets’ fear that there’s a “Treasury bubble”", there is the chance that a sudden rise in the price of oil might spark this type of sell-off. I'm not 100% on that, because I think the weakest part of the blog post is when after summing up this hypothetical market activity, he compares it to a recent event:

It will be a flash panic—much like the flash-crash of last May. The events I describe above will happen in a very short span of time—less than an hour, probably. But unlike the event in May, there will be no rebound.

I'm not sure what's changed between now and May. Perhaps he's referring to the fear of a "Treasury bubble", but it's not clear.

On to another point you made:

Unlike every other currency that he wants to draw a comparison, the US dollar is a major currency in the world. Other currencies are as "tied" (economically speaking) to ours such that when ours goes down, so does everyone elses. Yes, there could be a run on gold, or oil but they would begin to hit highs that would make them "bubble like" and would take pressure OFF of the treasuries. The german mark wasn't in that position, folks just went to other currencies. The Japanese yen was the same way. No on was going to run BACK to the yen when commodities got too high. But if the dollar gets way outta whack, there aren't alot of other currencies for people to run to, and they'll only run to metals, pork bellies and oil until THEY are perceived as a bubble.

This is something I find particularly scary, because Lira does refer to the fact that there are no other currencies by derisively scoffing at the euro: "By the end of that terrible day, commodites of all stripes—precious and industrial metals, oil, foodstuffs—will shoot the moon. But it will not be because ordinary citizens have lost faith in the dollar (that will happen in the days and weeks ahead)—it will happen because once Treasuries are not the sure store of value, where are all those money managers supposed to stick all these dollars? In a big old vault? Under the mattress? In euros?" (emphasis in original) The author did not make reference to the Weimar Republic, I did because that's the only historical reference that comes close to comparing to the blog post hypothetical. But even that wheel-barrow-full-of-currency visual might not come close to comparison because you're right: folks in the 20's did have other currencies to go to besides the German mark. I believe most of the stronger currencies at that time were on the gold standard. Now they're all tied to the dollar. So what happens when the world's reserve currency is debased? Worldwide hyperinflation? Speaking of bubbles, there's a conservatively estimated $85 trillion derivatives bubble which Warren Buffett refers to as http://news.bbc.co.uk/2/hi/2817995.stm">"financial weapons of mass destruction" that outprices whatever commodities bubble might balloon in the wake of hyperinflation. What happens when all those worthless dollars come back home from overseas countries that no longer need our stinkin' dollars?!

There are risks for sure, and we are in very rough political and economic times. And we could see something along the line he is talking about, a concern by the TBTF banks looking to spread their risks around. But honestly, they don't have alot of places to go.

When all is said and done, I'm far more worried about deflation. But that's probably because I owe money. This guy is holding money, so he's worried about it.

Rough political and economic times now and in the future, for sure. Honestly, I'm not sure which scenario is more likely. I'm very worried about deflation myself, there's a great column by Paul Krugman detailing exactly how deflation is http://www.chron.com/disp/story.mpl/editorial/outlook/7146458.html">decimating our infrastructure. But I think the possibility of hyperinflation can not be completely dismissed. Whether you're holding money or not (I don't have much besides a leaky 401k), I think the concern is legitimate.

[zipplewrath]

38. Legitimate vs probable

Like any qualitative analysis, it can all be based upon legitimate points but the question becomes is there a QUANTITATIVE basis for the scenario. The fact that his analysis is completely devoid of any numbers leads me to believe it is more emotionally driven than any real calculation.

Hyper inflation, as he points out, isn't so much about inflation as it is about a currency failing. It becomes "inconvertible" into anything. The closest US example is the "continental". However, as useless as they were at times, the price and value of goods remained fairly static against any other measure.

If one gets "stuck" with dollars, one would attempt to convert them. Gold, oil, land, diamonds, something, and in the case of hyperinflation ANYTHING. However, if there is NOTHING to convert them to, because effectively no one will take them, one is going to basically just "sit" on them. The world has dollars. If the dollar sinks, every other currency is also going to sink. There will be no where to go. There aren't enough pounds, or yen, or euros to suck up all the dollars out there. Like I say, I don't see the quantatitive analysis that says there is any place for the money to go TO. Any attempt to run to commodities will only create quick "bubbles" in those, with imbalances between them that cause rapid crashes. It won't take long at all for people to realize that chasing the latest bubble isn't "saving" them anything and just sitting on their dollars is as good as anything.

This isn't to say of course that there won't be some "scares". Panic buying and selling will occur and you could see various currencies fluctuate in short periods of time. But that isn't all that new to the commodities markets, or currency markets, and they "handle" them fairly well over longer terms. Stock markets don't do as well because companies can, and do, go belly up. Gold, oil, diamonds, etc don't do that. They don't dissolve into thin air. Neither do dollars.

[Greyhound]

3. K&R. Here's another example of how people not knowing how things work hurts them.

Hyperinflation is the loss of faith in the currency. Prices rise in a hyperinflationary environment just like in an inflationary environment, but they rise not because people want more money for their labor or for commodities, but because people are trying to get out of the currency. It’s not that they want more money—they want less of the currency: So they will pay anything for a good which is not the currency.
<snip>
—but they have accomplished one thing: They have undermined Treasuries. These policies have turned Treasuries into the spit-and-baling wire of the U.S. financial system—they are literally the only things holding the whole economy together.
<snip>
The Too Big To Fail banks will play a crucial part in this game. See, the problem with the American Zombies is, they weren’t nationalized. They got the best bits of nationalization—total liquidity, suspension of accounting and regulatory rules—but they still get to act under their own volition, and in their own best interest. Hence their obscene bonuses, paid out in the teeth of their practical bankruptcy. Hence their lack of lending into the weakened economy. Hence their hoarding of bailout monies, and predatory business practices. They’ve understood that, to get that sweet bail-out money (and those yummy bonuses), they have had to play the Fed’s game and buy up Treasuries, and thereby help disguise the monetization of the fiscal debt that has been going on since the Fed began purchasing the toxic assets from their balance sheets in 2008.
<snip>
Notice, too, that Treasuries will maintain their yields in the face of this sell-off, at least initially. Why? Because the Fed, so determined to maintain “price stability”, will at first prevent yields from widening—which is precisely why so many will decide to sell into the panic: The Bernanke Backstop won’t soothe the markets—rather, it will make it too tempting not to sell.

Emphasis mine.

Will this happen for sure? Of course not and the details may vary, but this is very possible and we have been put in this precarious position specifically due to the mis-steps and inaction during and immediately following the collapse. Simultaneously, we are pulling back and dismissing as "impractical" the only actions (jobs and $$$ at the bottom) that might head this off.

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." - Henry Ford

[robertpaulsen]

25. Exactly. Those points you highlighted from the article jumped out for me too.

In the wake of the 2008 Meltdown, the Treasuries are the only thing holding the economy together. The TBTF banks have been following the Federal Reserve's lead and buying them up. Without significant job growth (significant meaning like net growth in the 7 figures area), something's got to give. That something might be deflation like we haven't seen since the 30's, or it could be the scenario that Lira lays out. We shall see.

[librechik]

27. this is what infuriates me: RWers saying our Tbills are worthless IOUs, thus

talking down our economy and encouraging devaluing the perspective on our dollar. That scam drives the "Social Security is bankrupts" meme too.

WRONG!! It's just a propaganda slant to increase the ignorance and confusion and make our economy even more unstable, so the international globalists can come in here and own us.

[Kurt_and_Hunter]

5. Japan's Lost Decade did not feature hyperinflation

Japan's lost decade was a deflationary phenomenon. Prices actually dropped year after year after year.

Our situation is not very divergent from Japan's at all, which is why there is no rational prospect of hyperinflation in our situation.

[nadinbrzezinski]

6. Or the crisis in the 1870s in the US, the long depression

and there are many things in common with that one too.

Now talk about being a geek about this.

Hell a little inflation, oh about 5% or so, might be good right now.

[Greyhound]

10. A fundamental difference between both of those examples is that both nations had a

manufacturing infrastructure to slog through the massive subsidization of the banks in combination with comparatively sane business practices (or simply the lack of opportunity to act with complete negligence). Our current national industries consist primarily of plundering natural resources, the myriad "moving paper" professions, and an alarming amount of 'pretend manufacturing' (manipulating counting procedures to appear to manufacture what is really made by others, elsewhere). They both also retained markets to sell into, another factor we lack.

The main benefit of this blog, as I see it, is to expose things that so few people are aware of. This collapse was not an adjustment or correction, it was and continues to be, a collapse.

[nadinbrzezinski]

14. IN the 1870s the US was just industrializing

but that is ok. No crisis is the same.

I agree with you there are fundamental differences. For starters we no longer live in a capitalist system... and command economies, even when corporate controlled, are just less vibrant. (Yes once you look under the hood... to call this capitalism is just silly)

But that is a whole different story.

But to say that we will have hyperinflation and this guy is a gold bug...

[robertpaulsen]

16. "deflationary phenomenon" is an accurate description of Japan's Lost Decade.

What do you think about the author's point regarding Japanese sovereign debt being infinitely more stable than America's?

[Kurt_and_Hunter]

32. I found that paragraph unconvincing

Essentially he says Japanese debt is infinitely more stable because the Japanese own a higher percentage of the national debt and that Americans who own bonds are nervous nellie's.

Evidence? US bonds have been pretty stable for a long time. Last year they went up 1.5% to 4.0% and Warren Buffet declared a treasury bubble. Nobody panicked. They eased down from 4.0% back to 2.5% as people realized the economy was not going to have a v-shaped rebound. It was all perfectly orderly.

The top holder of US bonds is US bond mutual funds (it's kind of a three way tie between American mutual funds, Japan and China). The Japanese are famous savers but are not immune to financial panics... it felt like he recognized a flaw in his argument and tried to finesse it rhetorically.

Absent a robust economy already showing danger signs of inflation or any prospect of US default I don't see that a critical mass of people would react to a short-term spike that way.

He and I disagree on that.

[TheKentuckian]

15. I see some merit but I think he overestimating a move to precious metals

It can happen but those metals have a limited real world, shit gone down value.

Deflation remains a much more immediate concern.

[robertpaulsen]

28. I think the point made about precious metals

In the context of the article, the shift to precious metals would initially be as part of a larger move to commodities in general. Gold and silver will definitely go up in such a scenario, but you are right about the limited real world value in the sense that most Americans don't have a secret stash of gold in case the dollar has problems. Most have the attitude that, "Hell, it's the world's reserve currency, it's un-fucking-sinkable!" But I think the author addresses this to some degree because he doesn't seem to envision a future where gold and silver is our only currency. As he puts it:

I have no idea what will happen after we reach the point where $100 is no longer enough to buy a cup of coffee—but I do know that, after such a hyperinflationist period, there’ll be a “new dollar” or some such, with a few zeroes knocked off the old dollar, and things will slowly get back to a new normal. I have no idea the shape of that new normal.

[CreekDog]

17. we're facing DEflation not inflation

sheesh.

where the heck is the demand going to come from?

people aren't working and aren't buying what they were in previous years.

[Greyhound]

22. Read the blog. Inflation and deflation are totally different maladies that share some symptoms.

Hyper-inflation is the result, not of inflation or deflation, it is the result in devaluation of the currency through the complete loss of belief that it holds value.

Think pneumonia and lung cancer, both bad, both share many symptoms (@ least in the beginning), but different causes, treatments, and likely outcomes.

[zipplewrath]

24. But for a reserve currency

That would pretty much mean that ALL currency had lost value. That's a situation pretty much without precident. Unless you think there is an alternate reserve currency sitting out there.

[Greyhound]

36. Just how long do you think this global currency system has existed?

Saying that it's without precedent becomes meaningless when one considers that the system has only existed less than a century, and really only came to global dominance in the last 30 - 40 years.

The USD became the reserve currency because of it's stability and value retention and a lot of military action ensuring things went our way (Iran comes to mind). There is no rule that says it must always be so, any time the world decides that the Euro of the Rupee or Yuan is a better bet, hegemony is over.

[zipplewrath]

37. IF the dollar is collapsing

What other currency do you think will be "stable"? The stability of the dollar is based upon about 200+ years of performance. There aren't alot of other currencies that can make that kind of claim. The British pound is about the only one I can think of. Any instability of US treasuries is going to drag it down as well.

[Greyhound]

39. Travel delay, sorry. If that happens you are right and I think we will be introduced

to a new currency and accompanying NWO, the idea of national currencies and sovereign nations will become obsolete over a short time. In effect, the global Kleptocracy will be the order.

We've already seen the mechanism is action during the collapse. The supposedly competing central banks were suddenly working as one around the world to preserve their system.

[CreekDog]

29. why are you scared of something just because someone wrote it?

if you are not going to believe the vast majority of economists that are not worried about hyperinflation, then why are you going to believe some random person's economic theory?

[Greyhound]

35. I'm not afraid, see #3, 11, & 21.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=9013345&mesg_id=9013603">"...but this is very possible and we have been put in this precarious position specifically due to the mis-steps and inaction during and immediately following the collapse. Simultaneously, we are pulling back and dismissing as "impractical" the only actions (jobs and $$$ at the bottom) that might head this off". I guess I should have written 'this type of thing', because something will inevitably happen.

The systemic deficiencies and mechanisms for something like this exist and are not being addressed, that is the point I wished to make. I replied to your post because you said, "we're facing DEflation not inflation" and I wanted to point out that these are irrelevant to the hypothesis of hyper-inflation the author writes about.

I don't think this specific scenario is likely to happen, but it certainly is possible and it is possible specifically because of the insanity that has gripped economic policy for going on 40 years.

[Dark]

18. Krugman has said that we should be much more worried about DEFLATION.

I agree, as that would cause us to spiral down much more quickly.

[robertpaulsen]

30. I like Krugman. His analysis is always worth reading.

Something he wrote this month was quite revealing:

Lights are going out across America
By PAUL KRUGMAN
NEW YORK TIMES
Aug. 9, 2010, 8:06PM

The lights are going out all over America — literally. Colorado Springs has made headlines with its desperate attempt to save money by turning off a third of its streetlights, but similar things are either happening or being contemplated across the nation, from Philadelphia to Fresno.

Meanwhile, a country that once amazed the world with its visionary investments in transportation, from the Erie Canal to the interstate highway system, is now in the process of unpaving itself: In a number of states, local governments are breaking up roads they can no longer afford to maintain and returning them to gravel.

And a nation that once prized education — that was among the first to provide basic schooling to all its children — is now cutting back. Teachers are being laid off; programs are being canceled; in Hawaii, the school year itself is being drastically shortened. And all signs point to even more cuts ahead.

We're told that we have no choice, that basic government functions — essential services that have been provided for generations — are no longer affordable. And it's true that state and local governments, hit hard by the recession, are cash-strapped. But they wouldn't be quite as cash-strapped if their politicians were willing to consider at least some tax increases.

http://www.chron.com/disp/story.mpl/editorial/outlook/7146458.html



Sounds to me like Krugman's worries about deflation are because that's what's happening right now! I think the author of the blog I quoted acknowledges the role the Fed has had in exacerbating this:

But this Fed policy—call it “money-printing”, call it “liquidity injections”, call it “asset price stabilization”—has been overwhelmed by the credit contraction. Just as the Federal government has been unable to fill in the fall in aggregate demand by way of stimulus, the Fed has expanded its balance sheet from some $900 billion in the Fall of ’08, to about $2.3 trillion today—but that additional $1.4 trillion has been no match for the loss of credit. At best, the Fed has been able to alleviate the worst effects of the deflation—it certainly has not turned the deflationary environment into anything resembling inflation.

Yields are low, unemployment up, CPI numbers are down (and under some metrics, negative)—in short, everything screams “deflation”.

Therefore, the notion of talking about hyperinflation now, in this current macro-economic environment, would seem . . . well . . . crazy. Right?

Wrong: I would argue that the next step down in this world-historical Global Depression which we are experiencing will be hyperinflation.

http://gonzalolira.blogspot.com/2010/08/how-hyperinflation-will-happen.html

[Octafish]

19. Here in Detroit...

...my neighbors, independently, have brought up the idea that revolution is coming. The people can't take it, anymore.

At a nearby school, parents, independently, brought up the idea to get ready that the economy is ready to collapse. One, an ICU nurse, said she believes the "street people" will be able to survive. Those who think food comes from boxes won't have a chance.

Thank for the heads-up, robertpaulsen. It's getting obvious: The future isn't looking as hopeful as it was supposed to be.

[bobthedrummer]

20. It would be a counter-revolution since the installation of BUSH/CHENEY et al was a fascist

takeover and overthrow of our Constitution aka we, the people (a non-totalitarian and highly legalistic deceptive overthrow of our experiment in democracy by hardcore corporate fascist fanatics cloaked in religious militarism after 9/11)

One thing is for sure, things can't continue with what President Obama inherited nor what he's promised and attempted-people are scared, hurting and angry and fed up with MSM 24/7 political mind manipulation.

That's what I hear in rural SW. Wisconsin yet there's a strong RW racist undercurrent driven by the local powers that be.

The future is dimmingly hopeful because there isn't any hope in not taking action through political processes still available to citizens, especially those that have been apolitical most of their lives.

[Octafish]

26. That's why DU's important.

Most of the people I meet get their info from the tee vee. CNN and Fox and sometimes it's just Fox. Sick.

I tell them to go to DU. I then ask them if they use the GOOGLE and they all do. So I say, Bush crime family and see what happens. They'll find DU is monitoring and chronicling everything from stolen elections to Corporate McPravda to Wall Street looted trillions in Iraq with BP.

And my own tee vee just picks up this Cordoba Center.

[robertpaulsen]

33. Thanks Octafish. Here in L.A....

I have been meeting up with a number of concerned citizens regarding our economic predicament in the context of resource scarcity and Global Climate Change. Our last meeting a few weeks ago focused on the need for citizens to grow their own food and our personal efforts to do so. When you say, "Those who think food comes from boxes won't have a chance", I think the vast majority of people in my group would agree, though it gives me no joy to say so.

Ultimately, unless you change the way money works, you change nothing. Changing dollars to silver, gold, euros or some brand spanking new currency (Amero?:scared:) won't mean a thing unless our money is no longer tied to wealth creation but is representative of energy, both the human energy we produce and the planet's energy that we utilize. That means as people, we must live in harmony within the natural physical limits of our planet. That means our economy must be based on sustainability, not growth.

If it takes a revolution to accomplish this, I pray that it is peaceful. But this change must happen.

[Odin2005]

31. Oh. Shit.

:scared: