I can only see deflation

Graph lifted from Zero Hedge: http://www.zerohedge.com/article/charting-ten-year-prelude-keynesian-endgame – courtesy of John Lohman.

I will grant you that even though we may have entered a deflationary cycle, the path is not yet clear due to the fact that various government interventions are generating conflicting signals in various sectors. So, yes, it is not a straight path down for assets or up for the Dollar or gold. Nonetheless, the trend is clear.

The key is the efficiency of the currency (i.e. the efficiency of debt).

 

https://i2.wp.com/www.zerohedge.com/sites/default/files/images/user5/imageroot/von%20havenstein/Keynesian%20Endgame.png

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3 Responses to “I can only see deflation”

  1. Patrick Donnelly Says:

    The bubble in commodities will have some effect, but it will probably be the last one to burst? 2 Bn people are getting a greater share of the world economy and have a better demographic than the first world, even if China appears assymetric and ageing.

    Norway looks to be safe, as does Australia. Brunei? Bali? Chiang Mai? Malaysia like Mickeleen Hennigan? Parts of South America, if one can aim straight?

  2. Patrick Donnelly Says:

    Surely, Shirley, Japan gives a clue?

    There will be declining population and true capital in western countries as matters register, with those who can move either. Changes will not be positive, so moving to economies where retirement costs less, where taxes are not rising as fast as in the declining economies, makes much sense? Add a dash of fear over tsunami, earthquake and vulcanism and there are only a few destinations!

    • guidoamm Says:

      I like the prospects for Australia. Amongst other things, if we are indeed entering a cold cycle, probabilities are good that the farm land that is currently being sold off at fire sale prices due to lack of water, might be revalued upwards in the next ten to fifteen years.

      As far as South East Asia goes. I love the place particularly Chiang Mai. But, if I am right and we are about to be thrown into a global conflict, it is difficult to see how things will pan out politically. So that as the West must imperatively take the conflict to South East Asia, nationalism and ethnic tensions may be fired up… and a foreigner is always a foreigner… so that in the worse case scenario I wouldn’t want to be anywhere where I may be considered an “Imperialist”. Same for South America… Norway would be good but tough to get in legally and, once you are there, it is a horribly expensive country to live in.

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