Could the Weimar Hyperinflation Happen Again in America?

This is a discussion on Could the Weimar Hyperinflation Happen Again in America? within the Economic & Fundamental Analysis forums, part of the Methods category; Originally Posted by Technically Fundamental Look into it and you'll see why they are never going to be trading oil ...

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Old Jul 21, 2009, 12:59pm   #91
 
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Originally Posted by Technically Fundamental View Post
Look into it and you'll see why they are never going to be trading oil in any currecy but the Usdé
Don't be shy now TF...

Tell us why you think they are never going to be trading oil in any other currency but USD?

Does old Iraq - Iran fall into your reasoning? Or are their banking systems and laws of governance different to the other ME countries...

Do you envisage the US will place an embargo on old Europe if they venture to buy their oil in Euros?
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Old Jul 21, 2009, 1:08pm   #92
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Ay-rabs hold US dollars as their reserve in the banks and as the basis for their fx rates. You think they're going to mess with their whole system and risk gambling on another currency esp if the dollar gets weaker as you say. They will lose tremendous amounts which could only be recouped by banging up the price of oil which would be counter productive to a global recovery.
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Old Jul 21, 2009, 1:30pm   #93
 
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Originally Posted by WallStreetHero View Post
how do you have a depression and deflation at the same time,
well thank you for proving your a moron and shouldn't actually be involved in this discussion. good day sir.
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Old Jul 21, 2009, 1:35pm   #94
 
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"you cant belive everything you hear can you? maybe in your own world you do but here we all have different opinions and to blindly take someone elses opinion is what an idiot does."

yet all you have done is quote 4 people and not even offered your own opinion or explanation of how and why. good going!
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Old Jul 21, 2009, 2:01pm   #95
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Originally Posted by fleetwood View Post
I dont pretend to know much if anything about economics but it would be nice to know what to look out for. Some people are saying hyperinfaltion some people are saying deflation.

I'm curious as to what the warning signs are for each option. As far as I understand it in hyperinflation you would get increases in commodity prices(shoot me down if im wrong). So for example if I saw gold shoot past $1000 I'd assume hyperinflation is happening and I must act to protect myself.
I'm not really sure what you'd do in deflation. Any ideas genics??
Any ideas from anyone really.

P.S a nice heated argument is always interesting but wouldnt it be better to just know the available options and know the warnings signs for each option so you can act accordingly? Cant help thinking if your views are wrong you wont be able accept your wrong and so you wont act to protect your wealth.
The warning sign for inflation is deflation caused by economic contraction in countries with economies that run trade and fiscal deficits for years. The USA has a particular problem at the moment because the housing and retail sectors are imploding. With option arm mortgages resetting over the next two years it is likely that foreclosures will increase. Unemployment is still rising despite the stimulus plan and average working hours are down for those still employed. The bank profits are mostly down to sale of assets and changed accounting procedures. Basically the banking sector is insolvent. A lot of US govt debt is short term and finding purchasers for an ever increasing amount is going to be difficult. Investors will demand a greater return for purchasing this debt. As interests rates rise more homeowners and businesses will be unable to service their loans. More stimulus will be pumped into the economy on printed paper. The owners of US treasuries will begin to lose confidence and dump them causing a run on the dollar. US citizens realizing that their dollars are becoming worthless will start spending them, creating a hyper-inflationary environment.
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Old Jul 21, 2009, 2:06pm   #96
 
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one slight problem with that theory porboksy. what if us citizens don't have any dollars to spend...

read rhody traders post on the 1st/2nd page
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Old Jul 21, 2009, 2:15pm   #97
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one slight problem with that theory porboksy. what if us citizens don't have any dollars to spend...

read rhody traders post on the 1st/2nd page
I am sure that helicopter Ben will come to the rescue. (page7)
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Old Jul 21, 2009, 2:20pm   #98
 
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Originally Posted by Technically Fundamental View Post
what are you gonna do if we see deflation genics?
liquidate most of my assets into cash, then play the waiting game
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Old Jul 21, 2009, 3:07pm   #99
 
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"Most of FOMC see's inflation subdued in next 2 years"

Ben bernanke, today

what about the OMFG HYPERINFLATION???

guess he is a moron aswell wallstreet
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Old Jul 21, 2009, 3:17pm   #100
 
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Originally Posted by WallStreetHero View Post
Irving fisher is definatly an idiot. the only good investors and economists i have heard are jim rogers, marc faber, peter schiff and ron paul.

btw. just listening to other people would not help you, instead of taking every single word of someone you should do your own research.
http://www.trade2win.com/boards/gene...wsletters.html

as for ron paul, he is a conspiracy theory nut..so wouldnt pay much attention to him!
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Old Jul 21, 2009, 3:20pm   #101
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Do you not understand that this is the research Genics?
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Old Jul 21, 2009, 3:22pm   #102
 
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Originally Posted by Technically Fundamental View Post
Do you not understand that this is the research Genics?
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Old Jul 21, 2009, 6:29pm   #103
 
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ben bernanke, today

WASHINGTON (Dow Jones)--As he defended the Federal Reserve's rescue efforts, U.S. Federal Reserve Chairman Ben
Bernanke on Tuesday said inflation concerns are misguided, and reiterated to lawmakers that central-bank policy makers
expect inflation to be subdued for the next two years.
"I think they're misguided in the sense that ... the Federal Reserve is able to draw those reserves out and raise
interest rates at an appropriate time to make sure that we don't have an inflation problem," Bernanke said in response
to a question posed during a House Financial Services Committee hearing about inflation worries.
He later added that the financial markets don't seem to be worried about inflation.
"I don't think the financial markets are indicating a great deal of concern about inflation," he said, pointing to
long-term Treasury rates that are still "quite low."

Furthermore, Bernanke defended the Fed's plans to purchase up to $300 billion in longer-term Treasury securities
against charges that the Fed is monetizing the debt and stoking inflation.
When those purchases are completed, the Fed will still have less Treasurys on its balance sheet than it did two years
ago, Bernanke said, adding that the Fed's share of outstanding Treasuries will be at one of the lowest points in the
postwar period.
"We are not taking a significant portion of U.S. Treasurys," Bernanke said.
Asked if the Fed is considering selling off some of the Treasurys it has purchased, Bernanke replied: "We don't have
any near-term plans to divest ourselves."
Bernanke added that inflation, which is a rise in consumer price levels, "is very stable right now" and the various
measures of monetary supply are not growing quickly.
"Let's be clear about what's going on - the Federal Reserve is not putting money out into the economy. What we're
doing is creating bank reserves. It's not chasing any goods," Bernanke said.

Rep. Bill Posey, R-Fla. - just like Texas Republican Rep. Ron Paul earlier - was unconvinced.
"It's going to cause inflation," Posey insisted.
Bernanke responded by laying out the various tools the Fed has for exiting its rescue programs, pointing out, for
instance, that the central bank now has the authority to raise interest rates paid on reserves.
He later added that the Fed is doing its best to address the ailing economy. "We're trying very hard to support the
economy," he said.
Turning to a discussion about the Fed's Term Asset-Backed Securities Loan Facility, Bernanke said that while the
amount loaned through the TALF program is lower than expected, he wouldn't say it's off to a slow start. "It has been
effective," the chairman said, adding that the program is helping the credit market.
"So I think we'll continue to focus on that instrument," Bernanke said, and even suggested that the program could be
expanded.
"We are looking at some alternative assets, but they are very complex once you get beyond the categories already
included," he said.
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Old Jul 21, 2009, 6:33pm   #104
 
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you starting to grasp it yet wallstreethero?
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Old Jul 21, 2009, 6:36pm   #105
 
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30yr bonds are up a full handle on bens comments, so i would say the market is agreeing with his outlook.
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