Yellen needs inflation, soooooooooooooooo bad right now. If not a physical war that disrupts oil production and supply, then lets devalue the dollar, its the only other way, and yes equities will have to suffer, but little consequence, to fight off deflation, which is being exported to the US by emerging markets, as a result of their own currency devaluations to stimulate their own economies, time to fianlly, finally, get in that war, fight that battle, enough is enough. Dollar down, Oil and Gold up, yep, that'll do it, and instead of QE, let's call this QI, Quantitative Inflation. Just create something desired by your actions. So who is the most important person in the entire world right now with thew most power? Janet Yellen, and her court. banks will hate it, tech will suffer, but its needed now, because deflation will bring us all down, and we cannot have that. The lines represent the bottom and top of each item.
Comments
ida.pagnottella
⋅
I totally agree with you, what I can't figure out yet is if they need a crash on the SP500 first to justify this Quantitative inflation, or will they try and act immediately to avoid such a crash. Could you help me on this? I love the connection you make between oil and stocks, etc. Copper is important too here. thanks!!
claydoctor
⋅
I think they are very afraid of deflation being exported to the US economy, which would guarantee NO INFLATION. Lacking a war somewhere to stimulate it, and all the countries either having done their QE, Japan failed, and Europe trying their version of it now, and not seeing any inflation, and with the final bull market actions of M&A about over, there is really nothing left to support this market bubble but more euphoria of the bulls in denial, and the incredible desperation of money managers seeking yield and a return. Everyone with money is asking, yeh, but where do I put it now? Commodities finally bottoming is usually a laggard sign of the economy picking up. But the reverse is happening, and with GS saying Oil could see a $20 bottom, well, the FED is looking for something artificial to make OIL bottom and Gold, copper, and lumber. They need AI, not artificial intelligence, they need artificial inflation. And they don't know what to do to make that happen. The old fashion way is to have a market crash, and have valuations reach reality levels, wherever that is, and take the stock bubble out of the equation. Then they have to actually stimulate the economy, and create jobs, putting pressure on wages, and when people have more money to spend on a limited supply of goods, they will have their inflation, and can finally raise rates. And I don't what that answer is. The only thing I can think of is a war, which is what usually happens when countries start to go bankrupt, and the powerful ones take over the smaller weak ones, or try to. And if anything like that cuts off the OIL supply, i.e. china building islands in the China sea oil routes, then oil will bottom, even if demand does not pick up. That could be what has to happen. IMO. Hopes that helps.