Watch and see the disaster unfold, no one in thier right mind is gonna want to go long a 30 year treasure right now and demand is getting weak. Once our temporary semi stagdeflation ends, watch the super hyperstagflation strike. 20 dollar gallon of gasoline,etc.. DOW 50K homes selling for 15 million dollars etc.. This is what they want, asset inflation well its gonna come.
No, asset prices will FALL, along with GDP. What will shoot up are the prices of raw materials. Why? Not because of demand, but because during the boom years, no one can be bothered to invest in production and exploration. It's too dull. That's classic deflation.
Nope, hyperinflation raises the price of all assets. Look at what happened to the Zimbabwe market, And in Germany with the Mark. <object width="480" height="385"><param name="movie" value="http://www.youtube.com/v/a0adIEsqDF4?fs=1&hl=en_US"></param><param name="allowFullScreen" value="true"></param><param name="allowscriptaccess" value="always"></param><embed src="http://www.youtube.com/v/a0adIEsqDF4?fs=1&hl=en_US" type="application/x-shockwave-flash" allowscriptaccess="always" allowfullscreen="true" width="480" height="385"></embed></object>
If this is what unfolding disaster and weak demand looks like, I'd love to be the US Treasury (that's the chart of the current 30y UST yield for 2010)...