Considering the moves in commodities, industrials, and housing should we be expecting inflation around the corner?
John Rubino joins me to recap some of the moves in commodities and other industrial sectors that could very well be pointing to some near term inflation. The inflation trade is a tough one to believe in since it seems like forever since we’ve seen significantly higher inflation data however some of these recent breakouts are very noteworthy.
CFS……….Please……….you give the snowflakes a reason to bitch…..you are on the mining section……
The snowflakes do not care that they are being screwed…….they love to being lap dogs….
Don’t know about snowflakes but some don’t want to be Nazis. Failed once.
David, you’ve got a huge blind spot if you don’t think the Nazism is purely left. And why doesn’t anyone on the left ever mention Stalin, a leftist FAR worse than Hitler? I’ll tell you why: Brainwashing by the powers that be from cradle to grave.
Leftist governors have been dictators since the plandemic began yet leftist voters can’t see it. What gives?
I don’t care whether authoritarianism is right or left. I don’t want it. I want equal application of the law and no corruption. Don’t want lying, cheating and stealing and want to own property. Right or left Nazis have their own self interested agenda. Sounds like I don’t want the Constitution undermined or markets manipulated or favors for someone’s friends.
Same here and well said.. The thing is, authoritarianism IS left by nature since collectivism in all its forms must plunder the individual by force and do so arbitrarily.
Every Republican president of the last century has been a leftist in many important ways and Lincoln was a tyrant if there ever was one. Yet, thanks to a thoroughly effective misrepresentation of history by those in charge, both, Ds and Rs both love dishonest Abe just like Hitler and Marx did. I digress.
Leftists have the least regard for the smallest minority of all, the individual. That’s how you can easily spot them even when they’re hiding behind an “R”.
It’s a perilous situation, we have had inflation for many, many, years, the housing prices here started climbing in 1999, and they haven’t looked back. Even during the covid crisis we are still seeing double digit gains. In 21 years housing prices where I live have climbed over 550%. By every rule of logic the situation has become preposterous, the higher they go the harder they fall. Now The Federal Reserve Board wants inflation. LOL! DT
Dick, my memory goes back longer than yours and I bought my first house in the 1960s.
House prices have always increased during my lifetme, sometimes quickly, sometimes slowly….but ever increasing.
CFS, you just said a whole lot of nothing, any fool can see that gains like I mentioned are way off the chart compared to the wages I was earning in 1999, and would be earning now.
Of course those increases were mostly nominal, not real. Which makes sense since depreciation is a common-sense reality. For example, a family member of mine bought a home in southern California in 1963 for $25,000 which was equal to 714 ounces of gold at the time (since gold was $35 per ounce). Today, that house would go for a maximum of around $800,000 (Zillow figure) or 444 ounces of gold at $1,800 per ounce. However, realistically, I bet the place would sell for more like $650,000 or 361 ounces of gold. Either way, that’s a lot of depreciation just as we should expect after almost 60 years.
It’s funny (and scary) that the masses think they have gains even though every single home out there went up just as much as their own. What they really have in their home is a subpar inflation hedge.
Do you not think that comparing the price of a home in 1963 to gold to be a little unfair since gold was at a fixed price below what it probably should have been? How about if we compare the average price of a home in 1980 to gold using $850 per ounce. I have no doubt we would see a much different picture but that too would be unfair. I think they call it cherry picking.
Perhaps there’s some “unfairness” in my example but it’s nothing like using 1980 since that $800+ spike was about twice the price needed to back the U.S. M1 and M2 money supply at the time. So if you want to use $400-ish per ounce, you’d be onto something.
Regardless, my point is absolutely valid. Your “HUGE” gains are mostly nominal and depreciation is real even if hidden from the clueless.
What you don’t understand is that the gold price wasn’t fixed, the dollar price was. Gold has remarkably stable buying power regardless of the desires of little men and their their grandiose plans. Another example: A Ford Model T could be had for $600 or about 30 ounces of gold (@$20.67/oz) 100 years ago and the same 30 ounces today will get you a very nice $54,000 Ford pickup today, obviously a MUCH nicer ride than a Model T. Most don’t realize that sound money doesn’t maintain purchasing power, it gains it. This is due to technological gains being passed on to the consumer, naturally. The central bankers stand in the way of this process with their fraudulent money substitutes and harvest your gains in the process in addition to the rest of their ill-gotten gains.
Here’s another fun(ny) fact: The stock market peaked 20 years ago and the sheeple are happily paying big taxes on phantom gains while sitting on big losses (old buy-and-holders, of course).
“Sound money doesn’t maintain purchasing power, it gains it” . So gold gained purchasing power from 1980 to 2000?
Absolutely everything fluctuates, even gold. But note that gold spent the entire 1980s and most of the 90s at a price more than ten times greater than the level at which the Nixon bull market began. Absolutely every asset class is subject to the madness (stupidity) of crowds and that’s what drove the manic spike in ’79-’80 that lasted just a few months (with the greatest gains happening in weeks). Also note that gold corrects with commodities in general not in isolation like paper products do so its value relative to the building blocks of society doesn’t fluctuate as much as its debt-paper price.
Over the long haul, it most definitely buys more.
Perhaps some unfairness? No doubt about it. Oh, and I understand how the dollar and gold prices are.
In the first year of trading as a fiat currency, the dollar traded at $42 to $70 per ounce of gold. That was 8-9 years after the 1963 home purchase in my example and before Viet Nam spending and LBJ’s commie spending so $35 was probably not too bad a price. Either way, it certainly wasn’t cherry-picking since the government’s actions were keeping the dollar artificially strong, not gold artificially weak. In other words, the house in question probably still would have gone for 700+ ounces but the dollar price would’ve been higher.
Inflation is inevitable, the feds target is 2% I believe.
I wonder if going digital will placate the people, or for how long.
Yes,…..so buy stuff that goes up……..real estate and gold…. forget the cars…..lol
Ok ok ok ok lol,
Ok with this theory then Jerry and everyone else, how can housing continue to rise at the rate that it’s doing so and wage is not keeping up? This recipe does not sound like it’s going to sustain. So something has to give. I mean we are witnessing to 34 families living inside a house, students selling the condo and going back to live with mom and dad while they study, and re-mortgaging of homes on a constant base. The debt level in Canada alone or household income is higher than that of what it was in United States before the collapse and that has been mentioned here and on other sites many times. At some point and I believe it has started already many years ago people will start to foreclose the debt levels as well as the income or wages that have been stagnant for some time just cannot keep up throwing the coronavirus and this recipe smells like disaster. Also maybe DT can chime in I have a house in top in Toronto in Ontario Spring of 2016 I’m get to see houses rise higher than those prices. The average Home price since 2016 top in Spring in many areas has not been beating again. There is of course isolated areas and rich areas of course that continue to see a bit of a rise. But I’m not seeing lineups or I’m not seeing bidding wars like we were in 2016 top. I believe the housing top DT has topped in 2016 spring and we fallen in percentages possibly 15 to 18% since the top. Isolated areas have had small percentages go up but again those are certain pockets. I think this bounce will turn quickly and we will have much lower. No matter how much money they throw at it.I personally also expect for gold to the couple from the housing market at some point. In the end what I’m looking for is a top and gold in a housing bottom. I think they will correlate with each other opposites. But what do I know LOL
Hello Glen,
Borrow more money at cheaper interest rates, allow for more housing debt…..no increase in income.
The banking cabal, want more debt in the system.
They lower the interest rate, to 3 %, people borrow more money , than at 6% interest,
People always borrow , more than they should , based upon INCOME….
The income to service the debt, use to be 2 x one’s income, ….now, it is what 4 x the income…..so the sheeple borrower, goes out on the limb a little further, signing up for
more borrowing more debt more money , for that mcmanion, ……..The entire banking cabal trick is DEbT, and everyone falls for it…..They think the real estate is appreciating, when in reality the dollar is decreasing in value.
Forgive the writing lol..voice activation via phone. The last part I meant gold will decouple from housing as rates begin to rise and government really loses control.
Interesting thesis Glen. Haven’t central bankers boxed themselves in with ‘permanent’ low interest rates? They’re going to print money in 2021 asap. Inflation on the way, presumably, and up go precious metals, again, presumably.
I’ve been reading for forty years the Barron’s annual predictions published every january. Ten hedge fund types opining on the markets. For forty years these people have fretted over rising debt loads, government and consumer. Every year the only consensus they reach is that ‘muddling through’ is likely though the prudent investor should prepare for the worst.
And that’s about what i see coming, more muddling through. In this context housing remains the best investment the ‘average’ investor will ever make in his/her lifetime.
Glen, by the way, yes i am aware that rising interest rates would lead to massive mortgage defaults as used to be allowed before this ‘permanent’ low interest rate era.
Blaze,
I think also the bigger question will be when bonds finally crash the fed or Canadian government won’t have any control over it. It’s just a matter of time.
Hi blaze,
Allow me to speak in regards to the Canada market.From what I have learned and the school of thoughts I come from, housing Investment vehicle can be profitable if the timing is correct.
Personally I’ve always learned to ways to make it big are stocks/realstate if played correctly. Bullion itself is preservation of wealth and inflation. So two separate things imo.
Realstate/land= It ain’t sprig it till you sell and have that money banked in if indeed it did rise. But the question to ask yourself is, did it really rise or did it fall vs inflation? Nominal terms ve real terms.
I’ve learned that in ones lifetime we are lucky to have three buying opportunity of a lifetime if that. This requires patience for timing and to be rewarded. The two or three occasions in Canada have been going as far back as I can remember 1974 peak and 1985 bottom. Next major correction 1989-1996 both these marking massive 40/50% corrections from there peak. Downtown core getting hit harder. You not what’s interesting about both situations? The atmosphere or smell to it is similar to what it is now.. No jobs, corona virus helping that as well, increase of immigrants in the last 15-20 years at alarming rate combined with no jobs. He speculation with condos being put up at an alarming race. All three exactly what we have now. This next buying opportunity of a lifetime has started yet some are in denial. 2016 marked the peak and when it bottoms? Not sure but I have already seen a 15-18% percent correction from top and we are headed for 50% bottom. Gold should hit its peak. 2-3 years?
Rates will go higher as borrowing becomes much harder due to debt and government won’t be able to control it.
Over a long period of time house prices rise from low to high but lose vs inflation in real terms. You really need to nail those bottoms and sell those peaks..
Food for thought..
Most never nail it…………they lose it……. real estate is shelter, not investment, …
Some get it right, but, few,….they reinvest, in larger, and larger, with bigger and bigger mortgages and debt…..The majority of people never have a life without a hick up , going 30 yrs, without some correction is dang near impossible. The results is over leveraged debt, with a piece of real estate that is eating them alive with mortgage payments, utilities, taxes insurance, repairs…..The bigger the monster, the bigger the DEBT…..people lose a fortune, thinking they have appreciation in the over built , soon to be obsolete , needing for a remodel of their present abode……
Yes, some are smart enough to switch at the right time……but, far few….
Real estate investing , is when you let the other guy pay for the house….over time, with inflation working in the investors favor…..
Bingo! Or May I say ditto lol..
Al and Cory,
To many moderate my lost lately lol… wth?
I posted Jerry bingo on your post! Or better said ditto.. 👍😉
Lost=post
Glen……. 🙂
I am not liking what I’m hearing about this past presidential election. Joe getting a cat. America gets screwed. Just saying…
Hey guys,
I know this is the wrong forum but I have a favor to ask. Need all the brains and smarts and experience you have on this matter. We had a passing a way 8 month old in the family. Really sad moment.
As many of you know the terminology is SIDS! Really want to know what you believe could be causing this and if there is anything possible to avoid it. CFS chime in the whole group?
Thanks
Glen: Was the infant vaccinated?
BDC,
It’s a great question and now a sensitive one to ask them 😬. It’s the first thing that came to my head as well. Most probably yes but not sure.
Could it also be weak genes or DNA of mom or dad very weak. The father many years ago won a battle with cancer but lost one of his eyes.
I guess my bigger question would be which of those two factors would you lean over more, the vacine or possible weakened genes?
If on a vaccine regimen, the sheer number of injections into one so small is a great matter for concern (even if ingredients are inert).
In Canada or better said Ontario and New Brunswick these are the mandatory vaccines.
. Ontario and New Brunswick require immunization for diphtheria, tetanus, polio, measles, mumps, and rubella immunization,
Does anyone in here believe it is best to get none? I assume he and no. I live in Ontario and there is no way around this with the schools that I know of.
Such laws are institutional medical malpractice, promoted by Big Pharma.
Such laws are the laws of psychopathic control freaks and are immoral. I don’t understand how there can be so many sheeple who don’t mind being owned and I’m guessing there’s more than 6 billion of them.
People follow power, usually by following leaders.
All leaders seek power; however, most are bad, or even evil.
Truly good leaders who seek power are too often trashed with these.
Truly good leaders attempt to enlighten their followers and do not violate their natural rights. Good leader want to guide, not rule. Those who seek power over others aren’t “good” even if their intentions are.
There is only one ‘right’: the right to attempt to survive, which cannot be taken away.
All others are privileges — most often paid for in blood.
The “right to attempt to survive” is a right as long as it doesn’t infringe on the right of others to survive.
Rights can only be violated, not taken away. Every government on earth hates that logical fact.
My experience of life is pre-ordained. The breath of life comes from God Almighty. The rest is just people talking
off topic:
LIVE Testimony of Michigan election theft:
https://www.youtube.com/watch?v=3w7ah3UwCZ8