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Economy

Inflation is how much?

The Federal government is claiming that inflation is only 5.3 percent per year. This is despite the fact that energy is up 25%, gasoline is up 42%, and car prices are up 31.9% from a year ago. Home prices are increasing at a record pace, with June seeing an 18.6% rise– not an annual rise, an 18.6% rise in just one month. Year over year, home prices are up by about 31% year over year. (pdf alert)

We are being mislead. Anyone who buys anything and pays attention to prices knows it.

Meanwhile, stock market investors are happy. Good. I am trying to sell all of my holdings by the end of the year. Read this story to see why.

2 replies on “Inflation is how much?”

Be careful about getting out of the stock market entirely. I know it’s all manipulated. It has been for decades. But I’m still in it because of the risk of monetary inflation. The market could rise to keep pace with inflation which would partially protect my assets, as opposed to any fixed (cash) assets that would be devalued.

And foreign holdings are just as dangerous, since every major economy is totally dependent on exports to the US (China, Japan, Germany, Canada), and the US Navy that guards the sea lanes.

There’s dragons everywhere. My bet is to stay mostly in the US stock market and hope that I have something left in 5 years, and have some fixed assets in my possession.

And very soon the most precious assets may be bullets and beans.

I’m moving into investments that are not dollar denominated. Real estate, and physical items that are independent of the dollar. Yes, that means physical metals for the time being. I have increased my holdings in metals and real estate while decreasing my cash and stock holdings.

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