I agree that the public portion of the current nation debt (about 65% of GDP) is too high. The only way to reduce that number is to improve the GDP and/or to improve the trade deficit. This issue has very little to do with concerns over domestic inflation. As a matter of fact, a weaker dollar tends to somewhat reduce the trade deficit. Issuing additional US currency does contribute to the debt, but it is a small impact compared to the trade deficit. If the US wants to solve this, they need to start producing goods and services that the someone actually wants to buy.

You lost me. You are worried about the National debt but hate the IRS
that collects the money that could pay down the debt?

I do have a large percentage of my investments international in
order to diversify, plus that is where the most potential for growth is.
Hedging against the dollar is not my motivation.

Whereas previously I'd have said definately not now I say I don't know. When their own economy becomes strong enough it may not be necessary to get into any other currency, their own will suffice.

- Peter.

__________________
2021 Chevrolet Spark
Formerly...
2000 GMC Sonoma
1981 240D 4spd stick. 347000 miles. Deceased Feb 14 2021
2002 Kia Rio. Worst crap on four wheels
1981 240D 4spd stick. 389000 miles.
1984 123 200
1979 116 280S
1972 Cadillac Sedan DeVille
1971 108 280S

That might happen eventually, once they build up a large domestic consumer market. In the near term, they are dependent of the US as a market for their manufactured goods, and are stuck with lots of dollars. I agree that this situation will not go on forever, but I doubt it will change significantly in our lifetimes.

We'll see. I'm not so sanguine about the future. There are other factors at play besides just chimerica in isolation.

- Peter.

__________________
2021 Chevrolet Spark
Formerly...
2000 GMC Sonoma
1981 240D 4spd stick. 347000 miles. Deceased Feb 14 2021
2002 Kia Rio. Worst crap on four wheels
1981 240D 4spd stick. 389000 miles.
1984 123 200
1979 116 280S
1972 Cadillac Sedan DeVille
1971 108 280S

Very true, who knows what the euro is going to do?

Cotton up 90% in 2010
Silver up 75% in 2010
Copper closed out in 2010 at it's highest level EVER
Coffee up 60% in 2010
Sugar up 50% in 2010


The future is bleak for the dollar. Your wages will not keep up with inflation. And Bennie Bernake wants MORE inflation, because the price of housing is still going down. Now why is this important? Because property taxes are based on property values. when property values decline, so does the localities tax base.

http://www.youtube.com/watch?v=uPg4qTNTP-E

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You are looking at the results of speculation, not real inflation. If you want to gamble in these markets, have fun and buy some gold while you're at it.

Maybe YOUR wages won't keep up with inflation, but most of us are doing just fine in this market.

Maybe speculation, but it's extremely unlikely that virtually every commodity increased this past year due to speculation. It is inflation a direct result of the fed printing money.

I feel silver will outperform gold again this year. Silver is consumed, giving it the unique property of both a monetary metal and an industrial metal.

Want to have fun, buy some ASLRF.PK (Arian Silver Minig company)

Buying physical is not gambling. an ounce of gold (or silver) will always be an ounce.

I am self employed and the worse the economy gets, the more business I get (to some degree) I set my own prices (some members ridiculed me in another thread concerning pricing) and have the ability to react to market condition quickly.

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I'm am staying far away from that casino, it will be very ugly when the bottom falls out.

It's not inflation, it's just people who slept through their economics 101 class being conned buy the people who are selling this stuff at inflated prices.

Yes, with few exceptions (mostly junior miners) stay out of the stock market.

Hanes has no say in how much $ the farmer gets from his cotton crop.

By definition, inflation is simply an increase in the money supply. So you are correct a 90% rise in the price of cotton is NOT inflation, it is teh result of inflation.

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You should do what you want with your money. If you really want to hedge against the dollar, why not invest in some other currencies? Personally, I'm comfortable holding dollars; and speculating in the commodities market makes me very nervous.

Do you really think cotton is worth 90% more than it was a year ago? Do you think it will continue to go up at that rate? What are the fundamentals driving this market? Where do you think the top is? Unless you can answer those questions, run away.

Invest in other fiat currencies? no way. Do I think cotton is worth 90% more, simple answer is no. But I'm not the one buying (and paying that price) for raw cotton. But I will guarantee when my skivvies have new holes in them, they will be replaced, and I will pay for that 90% increase in raw material cost.

Do I think cotton will continue to increase, I really don't know the answer, but, I do know that China holds alot of USD, and if China want to buy each citizen a new pair of Levi's 100% cotton jeans, there will not be many people in the US buying Cotton jeans.

There is no top. with a fiat currency that is debased on what was a yearly basis, and now a monthly basis, there is no top.

As a general rule, I do not play the commodities, unless you consider buying and holding PHYS and PSLV playing commodities. Or, unless you consider hoarding the copper wire (and converters) that I pull out of the cars that I part out as playing commodities. No leverage, all physical,,,

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OK, if you really believe this; what are you doing about it?

Personally, I think this inflation scare is complete nonsense so I am happy to hold onto my dollars. If I believed any of this, I would be doing something else. If you don't think this is a bunch of hot air, you should take action to protect yourself.

If I was worried about inflation, I would probably buy undervalued real estate and be prepared to wait quite a while to recover my investment. As it is, I think we are more likely to see deflation, so I'm sitting tight.

I am trying to become as self sufficient as possible. The inflation is real. For the past 5 years, a 24 ounce heiniken cost $1.99 at the "C" stores. In MArch it went up to $2.19, August $2.39 thats a 40¢ increase in one year on a $2.00 item.

But you are also correct in there is alot of deflation, but it's mostly real estate.

I am of the opinion that real estate will continue it's decline through 2011. Until the cost of raw goods(to build the house) increases to the point where it's cheaper to buy a used house.

So a period of inflation (and rising wages) are needed to get the cost of housing in line.

I tried to have a few chickens, but the city didn't like the idea, so I'm entering the beekeeping arena.

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