Inflation

Inflation is a TAX that does not require legislation!

The USA national debt is $14.2 trillion and rising. 100% of the US GDP. If you add in unfunded liabilities (the social security and healthcare) the potential debt figure is ten times that.

The US budget deficit was $22.3 billion for February 2011. That was higher than that for the whole of 2007!

With more US QE on the cards the US can only be hoping all other currencies are devalued and inflation clears the papaper debt.

Lets all face it, it is now a long time since the US or UK held GOLD reserves to match the value of the currency.

Now money is only worth the paper it is printed on. FIAT money it is called. Can we have hyper infaltion? YES we can!

What will that do to your savings and fixed annuity income?

We are ALL being fed this austerity rubbish when the TRUTH is the debt is now so large only inflation will reduce it. All governments know this -they hope we will not all find out.

So if you want something buy it now. It will cost you 15% more in a year or two.

Buy GOLD the only safe hedge against inflation!

Re: Inflation

Well I would follow your advice Elbee but my savings are miniscule and I have no annuity income.......

I did buy a nice turnip at a bargain price the other day though!

Re: Inflation

The facts of the matter is that there are bits of the world which are getting relatively more wealthy while the likes of the UK are getting poorer. Our standard of living is falling as others, for example in China and Brazil, are on the rise. I don't see hyper inflation happening, just a gradual impoverishment of the old economies.

Re: Inflation

We can repay our national debt to other countries by printing more money!

We will never default, no country will. Money is not related to gold or other tangible reserves anymore.

It is all smoke and mirrors! If money fails (as it nearly did in 2008) we are doomed!

Re: Inflation

Inflation is what you expect from MP's who are full of hot air.

Re: Inflation

Inflation is what will reduce our deficit to a more manageable percentage of our GDP.
Remember when you first took a mortgage on a modest property and how financially painful it was. After a few year’s it became a lot less painful and the percentage of the property you owned increased due to it’s rising value. That is the effect of inflation and providing we as a nation keep up the interest payments is what will be a major factor in dealing with the deficit.

Re: Inflation

One could see an impoverishment of the western economies or more realistically a balancing out of economies as China etc start to catch up and well become the economic power it has the full capability of becoming.
We have become scared of spending though it is needed to keep up with a developing world, one that is not standing still. Thus on communications and the internet we rejoice that our broadband might reach 20mbs in some areas, in South Korea they have invested and it is 100mbs.