The "Miracle" Of Compound Inflation

Interesting information. Read complete article:

http://www.businessinsider.com/mauldin-inflation-2011-4

 

Inflation has the opposite effect of interest. So when it grows and interest rates fall the opposite effect of return will happen. I think we are entering a period of diminishing returns.

It is likely to last for twenty of so years. Because of the aging demographic.

 

Whatever. Meanwhile, this chart is to be respected:

http://www.thereformedbroker.com/wp-content/uploads/2011/01/My-Favorite-Chart-on-Earth.jpg

 

inflation also reduces the real-value of current debt.

 

Exactly... feels like "family planning"

 

US Treasury is basically borrowing money for free. The foreign lenders belive they make a 1-1.5% return on the 10y/30y bonds, but in reality they get 0% as the real inflation is ~1.5% above the official numbers.

 

Excellent article. Needs lots of discussions.

 

http://globaleconomicanalysis.blogspot.com/2011/04/no-miracle-cures-from-inflation.html

 

So anybody and everybody is better off learning Chinese, Portuguese or Hindu and moving to China, Brazil or India respectively. It makes sense: coasting economy going through a crisis is not going to post yields. Emerging economies: nothing but yields.