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HOT TOPIC Hyperinflation starting? What's happening in your area? Post your ground reports.

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WJK

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I agree, the inflation is here to stay.

The only other scenario - much, much bleaker - would be a plan to cut the cord suddenly and crash everything after everybody is in debt, to then socialize / buy up (think Blackrock but bigger and backed by gov) / do some other sweeping economic plan.

That's all speculation and nonsense though; the inflation is here and it's real.
That's what they did in 1980. Interest rates went from 9.5% to 21% & 22% just about over night. They put the brakes on the economy -- and yes, it really hurt. That happened over Christmas and it took us years to recover. I owned 2 RE offices with my partner. We sold one and closed the other one. I was just a kid and didn't see it coming.
 

thechosen1

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That's what they did in 1980. Interest rates went from 9.5% to 21% & 22% just about over night. They put the brakes on the economy -- and yes, it really hurt. That happened over Christmas and it took us years to recover. I owned 2 RE offices with my partner. We sold one and closed the other one. I was just a kid and didn't see it coming.
Yeah, see, stuff like that almost seems intentional.

It's like trying to destroy America on purpose.

Why didn't they gradually raise them?!

We can't control the idiocy from up top, but we can learn lessons from the past...
 

WJK

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Yeah, see, stuff like that almost seems intentional.

It's like trying to destroy America on purpose.

Why didn't they gradually raise them?!

We can't control the idiocy from up top, but we can learn lessons from the past...
We had double digit inflation at the time. That interest rate raise stopped the inflation cold in its tracks. It also killed everything else. There was virtually no lending for a couple of years.

I was doing plottage -- putting together housing tracks on land that had been up-zoned from RA to R-1. We were selling whole neighborhoods of up-zoned land so there were many different land owners involved in each project. After the deals were agreed to with the different land owners, it took 18 months to get a preliminary tract map from the city offices for the new housing tract. Then we would close all those deals for the contractor. When the interest rate hike hit, all of our contractors lost their funding from the Saving and Loan Associations and banks, for the land purchases and the construction. Several went bankrupt. We lost every project that we had in progress. It was over 3 years worth of work -- instantly gone with a governmental decision that had nothing to do with me.

But, I learned a lot during those 3 years that I worked on those deals. I learned a lot about putting together deals with a whole bunch of sellers. I learned about solving title problems, CC&Rs, and easement problems (Farmer Brown grants an easement to Farmer Green to walk his cow from the creek over to his north 40 acres...). I learned how the contractors put their tracts together. And then about the different stages of construction and marketing.
Mostly I learned how fragile life is. It can all be gone in a heartbeat.
 

VTK

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Are there factors other than the pandemic that are driving this inflation? Once the pandemic effects ease off, would you expect it to level out?
 

thechosen1

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Are there factors other than the pandemic that are driving this inflation? Once the pandemic effects ease off, would you expect it to level out?
It’s purely monetary policy. Pandemic is just the excuse of the day.
 

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I just YOLO into crypto 80% and stocks 20%.

I don't like debt.

I have some gold but that's it.

I have no idea.
Fortunately for you, I have heard that central banks began stockpiling Bitcoin to preserve their value in uncertain economic times.

Russia and China recently both got stimulus money from the IMF and immediately put it into Bitcoin. I have heard that China over the past years has quadrupled their Bitcoin holdings.

Just kidding...
 

AroundTheWorld

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Are there factors other than the pandemic that are driving this inflation? Once the pandemic effects ease off, would you expect it to level out?
Read Ray Dalio's "changing world order." Also, he has some you tube videos about "the big debt cycle." Great explainer / take on where we are and how we got here.
 

ljean

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This chart shows the 6-month moving average of my household spending over the past few years including: gas, utilities, insurance (home & auto), food, clothing, etc. It does not include debt payments or irregular expenses such as travel. The slope of regression line indicates a growth rate of 6.3% annually. It appears I'm almost back to my pre-pandemic peak.

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theag

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Seeing what's going on, what's your take on debt?
I've been debt free all my life but I'm wondering, maybe it is a good idea to get a mortgage at a fixed rate now for the highest duration possible.
I don't own any real estate at the moment...
Not related to real estate, but I signed my first commercial loan a few weeks ago. Basically free money at 0,7% fixed interest for 6 years. Only low 6 figures though, wish I could've gotten more.
 

Mckenzie

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America may be only weeks away from defaulting on its debts, undermining its pivotal position within the global financial system and throwing the US economy and global financial markets into chaos.

When the US hit its legislated debt ceiling on July 31 the Biden administration, unable to issue new debt, was forced to take extraordinary measures to conserve cash. It stopped issuing new debt, ran down its cash reserves, sold investments and suspended payments into some federal government employee retirement funds.”
 

thechosen1

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Isn't this an international issue though? Surely if it were just monetary policy, there would be variation?
The inflation issue is not affecting every country equally.

There are several countries with stronger currencies than the US, and some of them are actually gaining rather than losing...

Monetary policy is the primary cause of inflation, particularly printing lots of money with nothing backing it.

(Actually, you are backing it with your debt, your need to pay bills, not to mention the military power backing it)
 

GIlman

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Looking at the news today, I wonder if the new VX mandates will be the accelerant that triggers out of control hyperinflation in the US.

If we look at the labor issues right now, it’s causing low supply issues all over. Businesses are responding by raising wages & at the same time raising prices.

In the medical field we are seeing terrible labor shortages. I am seeing nursing and technologist positions listed for $7,000 a weeks to get people from other states to travel onsite. To put that in perspective, that’s more money than a significant proportion of physicians currently make.

I believe this is significantly due to medical personal quitting or being fired for not getting VX’d. I have heard from a lot of people in different fields that plan to get fired instead of taking the V. For instance in Houston one hospital fired 150 people for refusing the VX, that’s a huge number of staff for a hospital system all at once.


The narrative on TV is that nurses are overworked from CVD and burnt out. From my experience and talking to nurses and techs this is not true. I’ve spoken to no one that intends to leave because of workload, I know dozens of people that intend to leave if forced to get the Vx.

Certainly some un-v’d people will comply, but if the current situation in the medical field holds for other industries, we are looking at a significant reduction in the already struggling labor market. If this happens, businesses will either close down further restricting supply of goods or dramatically increase wages to compete for the decreasing limited pool of labor and will be forced to jack up prices to offset their costs.

If these things happen, and there is a significant chance they will…expect hyperinflation like we have never seen before.

Never underestimate the governments incompetence or ability to screw things up
 
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Kak

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The Effect of Fed Fund Rate Hikes on Gold

I found this very interesting. Most people think gold and interest rate hikes are inversely correlated... That isn't what happened when Volcker took office in 1979.

The article above says there is actually, ironically, some positive correlation.
 

thechosen1

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The best way to profit from gold...

Is to get it out of the ground ;)
 

GIlman

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The best way to profit from gold...

Is to get it out of the ground ;)

Yes…this is true.

Although bullion you control in a vault somewhere has a huge place in financial protection. Gold royalty companies give you the exposure to gold in the ground in a diversified leveraged way.

Gold miners also give you exposure but a good royalty company gives you more diversified more leverage position.

Research FNV (Franco Nevada), they are the original gold royalty and streaming company, There are others too, but FNV is the 800 lb gorilla in the space. I have read that they are the most profitable company per employee in the market, they have something like 9 employees. I have no way to validate that stat but if you understand royalty and streaming companies it makes sense that it would be true.
 

MJ DeMarco

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At Costco the other day, I saw a box freezer from $139. That seemed pretty darn cheap to me along with televisions ... gotta keep that obedient citizenry consuming mass media propaganda.
 

WJK

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At Costco the other day, I saw a box freezer from $139. That seemed pretty darn cheap to me along with televisions ... gotta keep that obedient citizenry consuming mass media propaganda.
What? Ice cream and TV? What a pair...
 

RicardoGrande

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There's been a lot of speculation that china's house of cards is set to crumble.
While the CCP seems to be taking steps to only hurt the small time investors and try to make it out unscathed, I wonder what message this will send to real estate investors and builders throughout the region if not the world?
 

socaldude

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Has anybody noticed the price of batteries like Duracell? Those AA and AAA batteries look like they went up a lot. I don’t remember the exact price and quantity but it definitely went up.

Something to do with lithium metal?
 

HabitsCampaigner

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I know that I no longer mow my lawn because the lithium ion batteries died and the price went up to $358; twice as much as the machine itself.

So I pay a team $40 to do it now.

Don't know about the tiny batteries but would be interested.
 

WJK

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There's been a lot of speculation that china's house of cards is set to crumble.
While the CCP seems to be taking steps to only hurt the small time investors and try to make it out unscathed, I wonder what message this will send to real estate investors and builders throughout the region if not the world?
I wonder too about their current changes. They try to look strong when they are weak and weak when they are strong. They are saber rattling right now while they are nationalizing everything. They are getting rid of their independent businesses. The owners are simply disappearing. And the price of their shipping is 4 to 6 times what it was just a heartbeat ago. They were the supply chain and now they don't appear to want to do business anymore. What is their end game?
 

AroundTheWorld

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I'm purchasing a flatbed trailer from a ma and pa manufacturer. Many of his vendors no longer have price sheets. The copper wiring he uses is priced now by the day. He had to call them on the day he took delivery for pricing. He said his costs for tires, bumpers and hitches have all gone up. His tire suppliers are experiencing shortages.
 

WJK

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I'm purchasing a flatbed trailer from a ma and pa manufacturer. Many of his vendors no longer have price sheets. The copper wiring he uses is priced now by the day. He had to call them on the day he took delivery for pricing. He said his costs for tires, bumpers and hitches have all gone up. His tire suppliers are experiencing shortages.
I'm trying to find some sheet rubber roofing for a mobile home and the adhesive that glues it together. I need it before winter hits and they might have it next summer...
 

DoingDeals

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The Federal Reserve can't wait for inflation & then act accordingly, at that moment it will be to late already.

The problem is it's a conflict of interest for them to control power, especially with cryptocurrency on the way.
 

socaldude

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The problem is it's a conflict of interest for them to control power, especially with cryptocurrency on the way

My guess is that crypto will be so heavily regulated or taxed that it will be a net wash and defeat it’s purpose against inflation, privacy and de-centralization.

Fiat money is efficient just not when these schmucks control it’s quantity and allocation like that.

Remember, they took all the tally sticks and burned them in front of the English parliament building.
 

DoingDeals

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I've been telling my business partner that cryptocurrency will be heavily regulated, he doesn't believe it.
 

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