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INFLATION: Could it look like this in 2014?

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posted on Mar, 27 2012 @ 11:43 AM
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What Inflation Could Look Like in 2014

Most economists, especially those from the mainstream, will tell you that inflation is widely expected to remain benign for the foreseeable future. And for those who think it could climb higher, it's usually because they think it should be higher. History has a message for them: be careful what you wish for.

There are plenty of examples in history showing that once inflation takes hold, it can quickly spiral out of control. That's the danger we face now. Here's what I mean…

A recent article about sudden inflation by Amity Shlaes, a senior fellow of economic history at the Council on Foreign Relations and a best-selling author, provides some examples from the past century of US inflation that was at first subdued but then abruptly rocketed to alarming levels. I put them into a chart so you could see how quickly inflation rose within just two years from "benign" levels. I then made some projections for us today based on these historical examples.





The analysis continues:




According to Shlaes, US inflation was 1% in 1915 (based on an earlier version of the CPI-U). Over just two years, it hit 17%. As she states, it happened because the Treasury "spent like crazy on the war, creating money to pay for it…"

Given the fact that our spending and money-printing is now out of control, I projected what our inflation rate would be if we matched the inflation rates of these time periods. The first striped bar to the right represents what the CPI would register if we matched the 1915-1917 rise. Inflation would hit 19% by 2014. (Yes, the CPI has been tinkered with many times, but this is at least what "unofficial" or "authentic" inflation would register.)

In 1945, the official inflation rate was 2%. It accelerated to 14% in 24 months. If we matched this percent rise, we'd hit 15% by 2014 (middle striped bar)..

And the example that kicked off the greatest bull market in gold and silver, the early 1970s. The CPI stood at 3.2% in 1972, a level close to ours today. It soared to 11% just two years later. Mimicking this rise, the third striped bar shows we'd also be at 11% in 2014. (Shadow Stats says we're already at 10% based on 1980 methodology, so from this level we'd hit 17% in 24 months.)

More...



Spooky stuff when you consider the historical analysis. One year, things look just great....then the next...boom.







edit on 27-3-2012 by loam because: (no reason given)




posted on Mar, 27 2012 @ 11:49 AM
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Stock up now!

Money's no good in the bank today if it won't buy food, boots, clothes, etc tomorrow.



posted on Mar, 27 2012 @ 11:55 AM
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reply to post by loam
 


If these projections are even close to correct we are in for interesting times over the next several years. You don't want to be in precious metals they can't keep pace with that kind of run up. Commodities will rise but price elasticity will keep them from topping the inflation rate. Growth equities is the only place to be to get ahead but it's risky territory. At best, fixed income investments will track inflation so you just tread water. Good luck if this happens and I believe there is a better than even chase it will. Go to shadowstats.com if you want even more scary data.



posted on Mar, 27 2012 @ 11:58 AM
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It think that it is going to get a lot worse before it gets better. We live in a materialistic world and that is the #1 problem on this planet. People are ungreatful for what they have and complain about what they want. The rich keep getting ritcher and the poor poorer.

No one said life would be easy, they just said it was worth living!!!

Have a great day all!




posted on Mar, 27 2012 @ 11:59 AM
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posted on Mar, 27 2012 @ 12:00 PM
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I want to know how shackling future generations with monstrous debt and liabilities isn't the exact same thing as selling them into tax slavery? Is this not slavery?

We will be worn down by taxes until we are dependent and helpless.That is how I see it.

Hoping and wishing that DC will be responsible with our money and the well being of our posterity is frivolous. They have proven they cannot be responsible!


If a thousand honest men were not to pay their tax this year, that would not be a violent and bloody measure, as it would be to pay them, and enable the state to commit violence and shed innocent blood. This is, in fact, the only definition of a peaceable revolution, if any such is possible. -Henry Thoreau, Civil Government, 1849


Is may be that simple...
edit on 27-3-2012 by METACOMET because: sa



posted on Mar, 27 2012 @ 12:02 PM
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reply to post by Teye22
 


I agree.

It is very likely that things will get far worse, before they get better.



posted on Mar, 27 2012 @ 12:05 PM
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It's coming alright.

This will be endgame for capitalism.

Right now we are at the point where the Titanic is bobbing up and down in the water and Kate and Leonardo are clinging to the stern, which is sticking way up in the air. The coming inflationary episode will be the part when the boat vertically descended and disappeared below the waterline forever.



posted on Mar, 27 2012 @ 12:08 PM
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2012,new home list for $120,000 USD now 2014 $275,000, $525,000 USD $1.75 Million, in 2014 gas price per gal now$3.49 then $5.25 2014, pay wage min now $7.25 phr then 2014, $8.35, but with more deductions it will work out your getting payed $6.15 an hour this is called inflation



posted on Mar, 27 2012 @ 12:09 PM
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reply to post by METACOMET
 


That would have been true of its time. But that was before

1913 reinvention of the IRS


Todays us tax system does not work the same as in 1849. Today the taxes are taken from you and you have to request they to be returned from the government.



posted on Mar, 27 2012 @ 12:11 PM
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reply to post by Leftist
 



Originally posted by Leftist
It's coming alright.

This will be endgame for capitalism.

Right now we are at the point where the Titanic is bobbing up and down in the water and Kate and Leonardo are clinging to the stern, which is sticking way up in the air. The coming inflationary episode will be the part when the boat vertically descended and disappeared below the waterline forever.


Well, that is overstating the case a bit, don't you think?

It didn't happen after 1917, 1947, or 1974.


Of course, that is not to say the future wont bring significant pain.




edit on 27-3-2012 by loam because: (no reason given)



posted on Mar, 27 2012 @ 12:14 PM
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reply to post by loam
 


There was nowhere near as much capital creation in past inflationary cycles as there has been in the last half-decade or so.

All that banker bailout money is about to come gushing into the real world at last...



posted on Mar, 27 2012 @ 01:10 PM
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It's disgusting how the world can turn like this and "ordinary" people just stand by and let it happen. No one is revolting, no one cares about the future, as long as "here and now" works fine and they have enough power on their iPhone to get through the day.

I found this image... to me it serves as one of, if not the most, glaring contrasts there are in the world right now. Please share it so people can be waken up...:





posted on Mar, 27 2012 @ 01:14 PM
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reply to post by loam
 


Given that QE has slowed the only thing that could spike inflation is through wages. Which, quite frankly, I don't think will happen.. the economy is so off track, so fubar, so discombobulated.. that historical comparisons won't amount to much.

Besides high inflation would be easy to contract, the Fed only needs to reign in a fraction of what they put in..



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