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      08-17-2011, 03:22 PM   #45
Echo M3

Drives: E90 M3
Join Date: Sep 2009
Location: NY

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Originally Posted by mact3333 View Post
You have to take core into it cause we have to pay for core inflation...nobody is giving you free food or gas correct?...the real inflation rate is twice as high as the govt is saying....why did a recent poll say that 95% of people polled say that they are paying more for food now then they did 1-2 yrs ago...why is my gas still 4.00 a gallon despite oil going down into 80's?...its because it doesnt matter much what crude oil does cause the gas station owners wont lower the gas price unless oil has been crushed for many months cause every nickel adds to their bottomline(I know several gas station owners).

People are paying more for bread and gas than they ever have so how is inflation not high?...esp since our wages havent gone up over the past decade...common sense....dont fall for the govt numbers game.

If you slowly create money and credit, it isnt necessarily bad I will agree, but we have increased our debt by 3T over the past 2-3 yrs! supply increase plus added velocity is what is important(true M3)...what epople dont understand is this, when the bond mkt wakes up they wake up with a fury and inflation can increase very rapidly very all bubbles inclduing the stock mkt in late 99' and eventually gold, things can go up and DOWN quickly depending on social mood and etc...when things let go they let go hard and is a vicious cycle.

If the bond vigilantes demand more yield cause our debt keeps going up and up...its a catch 22 situation cause the amount of money to service our debt will increase rapidly as interest rates go up and also in an environment where baby boomers will be using more medicare and SS, the debt and inflation can spiral out of control quickly.
Bolded part is false. That's basic economics man. Retail prices ALWAYS lag market rates for crude oil. Crude only started falling 2 weeks ago. Wait 3-4 months, and then see. I guarantee that gas prices will drop. You can quote me on that.

Food prices are elevated in part due to historically large droughts. The rest, I can't explain. I don't think it is inflationary, though, or else we'd see the price of EVERYTHING rising. Please explain to me why we are in an inflationary period, if everything from property prices to electronics to clothing is stagnant, falling, or rising SLIGHTLY?

PS - I agree with your core argument (no pun intended, lol). You're absolutely right, that we ARE potentially creating a bubble.

Last edited by Echo M3; 08-17-2011 at 03:30 PM.