Many investors are treating inflation as a certainty because the Fed has expanded its balance sheet to unheard of levels through its quantitative easing strategy. Some have even gone so far as to say that this program will utterly destroy the U.S. currency. To demystify this conclusion, I’m going to explain quantitative easing and why the Fed is using this monetary strategy. Afterward, I’ll explain why gold is still positioned to rise even if inflation continues to be low. Words: 786

With investors concerned about inflation it begs the following questions: "What is the best way to attempt to inflation-proof ones' portfolios? Buy TIPS? Short Treasury bonds? Stocks? Real Estate? Commodities? Gold? Currencies?...[In this article we review each option and come to a conclusion as to how best to hedge the risk of inflation.] Words: 1672

The “Deflationary” portion of the long-term economic cycle is called Kondratieff Winter. It is characterized by huge debts with a topping economy and stock market. We hit the K-Wave Winter in 1929, and again in the year 2000. The most important factor in how things play out in a K-Winter is the “state of the Dollar.”

Greenspan orchestrated massive asset price inflation in the face of K-Winter Deflation by aggressively printing and devaluing the US Dollar. Many look to see “where the Dollars are going”, but it is the effect of Dollar Devaluation on Price Inflation that is most important. The Dollar Devaluation will grossly devalue the debts while driving key asset prices like Gold sharply, higher.

The July 2011 Consumer Price Index for Urban Consumers (CPI-U) released yesterday puts the June year-over-year inflation rate at 1.66%, which is less than half the 3.82% average since the end of the Second World War. That being said the ShadowStats Alternate annualized rate of inflation is 9.26%. [Which is more accurate?] Words: 384

The July 2011 Consumer Price Index for Urban Consumers (CPI-U) released yesterday puts the June year-over-year inflation rate at 1.66%, which is less than half the 3.82% average since the end of the Second World War. That being said the ShadowStats Alternate annualized rate of inflation is 9.26%. [Which is more accurate?] Words: 384

If inflation starts to head towards 5%, you can be sure it’s headed for 10% because they don’t have the ability to stop it now. The only antidote they have to the mess we are in, which is massively excessive debt reinforced by derivatives, is unlimited money printing. The idea that you can withdraw the punch bowl or sharply raise interest rates, it just doesn’t exist, unless you want to take a complete deflationary collapse.

It’s incredible that the Mayans forecast 2012 would be the end of a major era. It looks, today, like we are standing on the eve of massive changes in the world that will have consequences for a long, long time to come. The scene is already set....the euro will collapse, and...other major currencies will collapse. The consequences of these (eventual) collapses will be horrible because we will have a hyperinflationary depression.

We’re coming to the end of government’s ability to borrow money to fund current spending that’s beyond the growth of their economy....and I actually find that massively bullish because that government funding misallocates capital. It’s going to end in the next 2 or 3 years, Europe first, then Japan, then the US....

You don’t need [actual] deflation—a reduction in the outstanding supply of money—to have markets react to a decrease in the rate of money supply growth..., anticipate the eventual deflation [and begin to price it into the market. Remember 2008?] Oil prices fell from $147 in July of 2008 to $33 per barrel by early 2009. The S&P 500 went into free-fall starting in September of 2008 and bottomed out in March of 2009—falling almost 50% in six months. This is what has already happened to the gold mining sector but, remember, central banks may be on a counterfeiting holiday right now but they have a history of taking very short vacations.