Loading ...InDeFlation
Could tracking Flation be as simple as following the TIP ?
WTF is a TIP Fully ?
https://www.ishares.com/us/products/239467/ishares-tips-bond-etf
So I take that to mean if TIP goes up that’s In flation
If it goes down that’s De flation
It is confusing because if TLT goes up that means rates go down and that happens in a De Flation.
If I understand this TIP thing correctly the TIP is a Tipoff of where Flation is going
and therefore presently it’s goin De !
If TIP doesn’t bounce here it will TIP over pretty hard…ie…we have an important trend line right here
Sometimes a trendline can get blown out with a GAP and fall hard….sometimes …
Pass the Popcorn
And another thing …Why is Deflation such a bad thing ?
It has been vilified….Like POT….Lower Prices and Marijuana…two things that make people feel good have been basically considered as Evil.
What if its better for the masses to see LOWER PRICES….Lower money supply = lower prices = higher standards for the people….buy more things with less money
I heard the argument that when prices are decreasing people don’t buy as readily as they wait for even lower prices.
I think that’s bs . I know I actually am enticed to buy when prices are obviously dropping.Who wants to wait anymore…NO one…we want it now…we can use it up and then buy another one next year when it will be more advanced and less expensive because of deflation
If over supply of money by the Money Creators , is why we are headed for an explosion in the financial markets , why is decreasing money THE Most evil thing economisst can think of.
What’s wrong with cheaper every thing ? It means Money is worth more.
Ah but the problem is Debt…your things are cheaper to buy but you are paying more on your debt …so that’s a wash
bring it on .
The deflation risk is propaganda.
Inflation (fiat growth via deficit spending financed by bonds that central banks buy) is the way governments cheat their citizens, by paying back that debt with money that’s worth less over time as more of it is created.
And TIPs pricing … IIRC … depends on a CPI that’s measured wrong. Understating real price changes so they are no protection at all.
American wealth grew fastest during the 19th Century, when we had no central bank (and fewer wars) and prices rose and fell but ended the century about where they started. Deflation RAISES real labor earnings and the prosperity was broadly shared. None of the dramatic inequality you have today where those engaging in financial speculation derive excess gains.
Thank You pedro_deleon
That is a beautiful explanation in a Nutshell of a very important point. Not many can see that.
https://www.armstrongeconomics.com/markets-by-sector/interest-rates/interbank-rates-starting-to-rise-monetary-crisis-is-beginning/