https://www.omfif.org/2020/06/us-unprepared-for-money-supply-boom/
Look at the incredible, unprecedented acceleration higher in the increase of the money supply recently. This parabolic move higher on the chart is actually typical of a market having a blow off top, which hits a spike higher and then...........crashes lower. In this case, the reaction is likely going to be a rapid acceleration in inflation. The price of everything will go higher.
https://fred.stlouisfed.org/series/M2
https://www.statista.com/statistics/1121054/monthly-m2-money-stock-usa/
Along with all of that, the value of the US dollar will continue to drop.
The price of commodities, which are in US dollars goes higher in tandem with the value of the dollar going lower.
you aint seen nothing yet.
but remember this... if you look at the long term chart of the dollar index,... the largest drop was from about 1985, into the early 90's. but... that did Not corespond with the largest increase in gold or oil prices.
i see the run up in commodity prices this decade to be less (precentage wise), than the run up last decade.
I've been hearing about the coming inflation for 30+ years.
Never more vocal than the last Fed money printing orgy of 10 years ago. The inflation never happened. I can't claim to be right about it either. It seemed like a reasonable prediction. It would have been nice to hear the inflation alarmist admit that they were wrong these past 10 years. (I myself admit I was wrong). Not only is their silence deafening, but they are as alarmist as ever. Maybe this time they will be right.
It is worth noting that there are areas where inflation is actually present. Home prices, stock prices, healthcare, and college tuition. Food and energy, not so much.
of course, the Big inflation has been with health care.
if you do not have ACA (fed help), the price of health insurance is up 400% in the last 10 years.
price of my sisters thyroid meds up 1600% the last 10 years.
the price of my daughters birth control pills up 400%.
and this does not include the fact that deductibles are thru the roof. (rising deductibles are another form of a price increase).
you can thanks obama for all this.
This is not my area of expertise but I've never given inflation much thought before during the period you mentioned joj but those are great points.
However, I showed the graphs to illustrate the difference between then and now.
This is different........much more extreme. The increase in money is off the charts....actually at the top of the charts (-L
There are other factors that will affect inflation too so maybe those will offset some of it.....or make it worse.
MM - Agreed the Fed is pumping on steroids this go around.
Bear, check this chart out:
https://www.chicagofed.org/publications/chicago-fed-letter/2018/407
Ran across this while looking for a thread related to the Dollar Index