Click to enlarge:
I drew in the arrows to call your attention to the astounding increase in money supply, and in a recession at that. The nation's GNP does not justify this, so inflation seems to be inevitable outcome.
Monday, January 26, 2009
Inflation seems to be inevitable
This graph from the Federal Reserve Bank of St. Louis is shocking. It shows the nation's money supply from the end of the First World War to the present. No matter what your political views may be, this should be a slap in the face. The Congress is spending in a manner that is sure to drive the nation head first into the ground. You should begin preparing your family finances right now. Inflation seems to be the inevitable result of such "money-printing" policies.
Click to enlarge:
I drew in the arrows to call your attention to the astounding increase in money supply, and in a recession at that. The nation's GNP does not justify this, so inflation seems to be inevitable outcome.
Click to enlarge:
I drew in the arrows to call your attention to the astounding increase in money supply, and in a recession at that. The nation's GNP does not justify this, so inflation seems to be inevitable outcome.
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10 comments:
The question is where are family finances safe now? Bonds, securities, gold or bed mattress.
Food Storage. Buy Ramen noodles now while prices are low, they can be easily stored and sold at a much higher price during Armegedon. You might also consider purchasing stock right now in Malt-o-Meal because more people are buying and eating cheaper cereal because they use bags instead of the more expensive cardboard boxes.
In addition to food storage, families should probably have enough cash in a savings account (not checking) to live without work for three months at minimum, but more is better. I am curbing by desire for 'things' and redirecting extra cash after savings to paying off debt (I have only very cheap mortgage (5.25%) and car loan (4.9%) debt). Do not under any circumstances carry forward credit card debt. It is akin to drinking financial poison. Although I don't have any leeway to buy gold, it might be a good idea to have gold coins, which will never be worth zero.
Lastly, pay off your mortgage first before buying stocks (unless you a participating in a 401k plan). You can't live in a stock certificate.
However, you can live in a cardboard box which is easily acquired. and very inexpensive to maintain. Although the life span of such a house if as long as it takes to rain again. So I concur with you Alan....pay off debt and mortgage and start saving like crazy.
However, you may save until the sky falls, but if inflation really runs away with us, things can get so expensive so fast that fists full of cash may not tie you over. I too am trying to pay off our house. We are cutting back everywhere. Our next cuts will be to cable TV and internet at home if we must. We have already cut out nice restaurants, big theater productions, pro sports and go to about 1/4 as many movies. Feels like a recession to us!
We are saving, maybe enough to keep up with inflation, not enough to outpace it. We will be lower middle class for the duration. But hey, we have each other, and if Nick's health returns completely as we hope, well, nothing else much counts!
Mom and I when we bought out little town home, did not have much cash and my military retirement had not started. The best loan we could find was at 10% interest and we made it for ten years. Big payments took all we could scrape together every month. Alan came to our resuce and gave us a loan to pay of the morgage and his rate of interest was much less than 10% but also more than he could have received on his savings at the bank. So we both profited and wew ere still able to pay of our loan in ten years. Oh, happy day when we had that paid off!!! We still do not have a large cash savings, but we have been trying to put a little in each month as well as support ourselves on this mission. A couple of months it has been tight, but we always have made it until the next payday. When we come home we will only have two loans still existing on things that I borrowed from my life insurance. We have no real food storage at home, but plan to augment the things we do have. We do have wheat aplenty and beans and honey for long term storage. So if things get tight, we have wheat and honey and beans to share. Our Prophets have tld us for years to be prepared for some lean times, and I do believe we are coming to that now. I am very concerned about taking on any new debts, even for a newer car. I am willing to live with our 1994 Plymouth Acclaim, but we shall see what happens after we get home and relook at our budget. My advice to all is get out of debt, and have some spare change in your pockets. And Deric, Ramen noodles are not only good, I like them. Mom and I had them yesterday.
Well, ramen noodles are the least nutritious food I can think of. You can make them nutritious by adding cabbage, onions, a small slice of ham, and other things. If you don't want to add things to your ramen, at least have some vitamins in storage so you don't suffer from malnutrition.
You are right Alan. M
Steak and Lobster on the menu here tonight. Kim just living in the moment.
Kim, you are one of a kind. You do make me laugh!
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