Peter Schiff: Housing prices will go back to 2000 or lower…

[(former)FormerSanDiegan]

Stocks did outpace inflation from 2003-2007.

… even if you use shadowstats estimates of CPI which averaged 6 to 7% in this period.

Even if you used shadowstats projected M3 money supply growth, stocks outpaced that.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

[(former)FormerSanDiegan]

Commodity prices reflect the acceleration in inflation. Not a direct 1:1 correspondence.

Think second derivative from calculus.

Or, for those remedial math types, the change in slope of the curve.

For example, if inflation goes from 2% to 6%, commodities might rise by 100% or more over a short period, depending on how fast this change in inflation occurs.

Oil declined 68% from 1980 to 1998.

Did we experience 68% deflation in prices over this period ?

No, we experienced a decline in the rate of inflation.

I rest my case.

[(former)FormerSanDiegan]

Commodity prices reflect the acceleration in inflation. Not a direct 1:1 correspondence.

Think second derivative from calculus.

Or, for those remedial math types, the change in slope of the curve.

For example, if inflation goes from 2% to 6%, commodities might rise by 100% or more over a short period, depending on how fast this change in inflation occurs.

Oil declined 68% from 1980 to 1998.

Did we experience 68% deflation in prices over this period ?

No, we experienced a decline in the rate of inflation.

I rest my case.

[(former)FormerSanDiegan]

Commodity prices reflect the acceleration in inflation. Not a direct 1:1 correspondence.

Think second derivative from calculus.

Or, for those remedial math types, the change in slope of the curve.

For example, if inflation goes from 2% to 6%, commodities might rise by 100% or more over a short period, depending on how fast this change in inflation occurs.

Oil declined 68% from 1980 to 1998.

Did we experience 68% deflation in prices over this period ?

No, we experienced a decline in the rate of inflation.

I rest my case.

[(former)FormerSanDiegan]

Commodity prices reflect the acceleration in inflation. Not a direct 1:1 correspondence.

Think second derivative from calculus.

Or, for those remedial math types, the change in slope of the curve.

For example, if inflation goes from 2% to 6%, commodities might rise by 100% or more over a short period, depending on how fast this change in inflation occurs.

Oil declined 68% from 1980 to 1998.

Did we experience 68% deflation in prices over this period ?

No, we experienced a decline in the rate of inflation.

I rest my case.

[(former)FormerSanDiegan]

Commodity prices reflect the acceleration in inflation. Not a direct 1:1 correspondence.

Think second derivative from calculus.

Or, for those remedial math types, the change in slope of the curve.

For example, if inflation goes from 2% to 6%, commodities might rise by 100% or more over a short period, depending on how fast this change in inflation occurs.

Oil declined 68% from 1980 to 1998.

Did we experience 68% deflation in prices over this period ?

No, we experienced a decline in the rate of inflation.

I rest my case.

[kewp]

Stocks did outpace inflation from 2003-2007.

Total economic inflation from 2003-2007 was almost 100%.

The DJI went from 8,000 to 12,000 during that same period. That’s nowhere near a 100% gain.

Maybe you are talking about emerging markets or something? I’ll agree *some* stocks beat inflation during that time period; but the domestic indexes surely did not.

Oil went from $27 to $63 a barrel during that same time period, however. Gold went from $300 an oz to $700. Both were much, much better investments than stocks during the above mentioned time frame.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

Except when they do. Like now.

Oil declined 68% from 1980 to 1998.

I rest my case.

Uh, yeah the Fed hiked interest rates in the 80’s to kill inflation; plunging the US into a major recession. Good thing too.

Unsurprisingly, this was reflected in the price of oil. The exact opposite is happening now.

This really isn’t so hard to understand, you know.

[kewp]

Stocks did outpace inflation from 2003-2007.

Total economic inflation from 2003-2007 was almost 100%.

The DJI went from 8,000 to 12,000 during that same period. That’s nowhere near a 100% gain.

Maybe you are talking about emerging markets or something? I’ll agree *some* stocks beat inflation during that time period; but the domestic indexes surely did not.

Oil went from $27 to $63 a barrel during that same time period, however. Gold went from $300 an oz to $700. Both were much, much better investments than stocks during the above mentioned time frame.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

Except when they do. Like now.

Oil declined 68% from 1980 to 1998.

I rest my case.

Uh, yeah the Fed hiked interest rates in the 80’s to kill inflation; plunging the US into a major recession. Good thing too.

Unsurprisingly, this was reflected in the price of oil. The exact opposite is happening now.

This really isn’t so hard to understand, you know.

[kewp]

Stocks did outpace inflation from 2003-2007.

Total economic inflation from 2003-2007 was almost 100%.

The DJI went from 8,000 to 12,000 during that same period. That’s nowhere near a 100% gain.

Maybe you are talking about emerging markets or something? I’ll agree *some* stocks beat inflation during that time period; but the domestic indexes surely did not.

Oil went from $27 to $63 a barrel during that same time period, however. Gold went from $300 an oz to $700. Both were much, much better investments than stocks during the above mentioned time frame.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

Except when they do. Like now.

Oil declined 68% from 1980 to 1998.

I rest my case.

Uh, yeah the Fed hiked interest rates in the 80’s to kill inflation; plunging the US into a major recession. Good thing too.

Unsurprisingly, this was reflected in the price of oil. The exact opposite is happening now.

This really isn’t so hard to understand, you know.

[kewp]

Stocks did outpace inflation from 2003-2007.

Total economic inflation from 2003-2007 was almost 100%.

The DJI went from 8,000 to 12,000 during that same period. That’s nowhere near a 100% gain.

Maybe you are talking about emerging markets or something? I’ll agree *some* stocks beat inflation during that time period; but the domestic indexes surely did not.

Oil went from $27 to $63 a barrel during that same time period, however. Gold went from $300 an oz to $700. Both were much, much better investments than stocks during the above mentioned time frame.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

Except when they do. Like now.

Oil declined 68% from 1980 to 1998.

I rest my case.

Uh, yeah the Fed hiked interest rates in the 80’s to kill inflation; plunging the US into a major recession. Good thing too.

Unsurprisingly, this was reflected in the price of oil. The exact opposite is happening now.

This really isn’t so hard to understand, you know.

[kewp]

Stocks did outpace inflation from 2003-2007.

Total economic inflation from 2003-2007 was almost 100%.

The DJI went from 8,000 to 12,000 during that same period. That’s nowhere near a 100% gain.

Maybe you are talking about emerging markets or something? I’ll agree *some* stocks beat inflation during that time period; but the domestic indexes surely did not.

Oil went from $27 to $63 a barrel during that same time period, however. Gold went from $300 an oz to $700. Both were much, much better investments than stocks during the above mentioned time frame.

Your mistake is assuming that commodity prices correspond 1:1 to inflation. They do not.

Except when they do. Like now.

Oil declined 68% from 1980 to 1998.

I rest my case.

Uh, yeah the Fed hiked interest rates in the 80’s to kill inflation; plunging the US into a major recession. Good thing too.

Unsurprisingly, this was reflected in the price of oil. The exact opposite is happening now.

This really isn’t so hard to understand, you know.

[peterb]

For insight about the stock market, commodities and the housing market, check out Jim Rogers last book. I think that Chris Puplava just wrote a very good article on it as well. In terms of inflation adjusted, which you must do given its huge rise in the last 10 years, the Dow is at about 8000. Measured in Euro’s, in aint much better. And dont consider the CPI anywhere near accurate for inflation measurement. See http://www.shadowstatistics.com for accurate inflation and unemployment numbers.
We are about 10 years into commodities bull market and they historically last 15 to 20 years. What’s more important, they’re always inverse to the equities market. The US Govt has flooded the global financial system with so much US$ since 2001 that the dollar has been blown away. So this makes measurements in nominal $ very misleading. It’s also why almost every asset class has gone up in the last 8 years!! This is a VERY unusual event. And our extreme inflation explains why. Give a read to Marc Faber as well. He’s had some great insight in the last 10 years.
At any rate, given that the Fed will continue to print $$ and the commodities market is far from over, we should see oil and other commodities continue to rise despite the global recession that starting happen. This was the case in the 1970’s. It is comforting to see supply/demand maintain it’s power in the market despite all the attempted manipulations by central bankers and large money managers! My 2 cents.

[peterb]

For insight about the stock market, commodities and the housing market, check out Jim Rogers last book. I think that Chris Puplava just wrote a very good article on it as well. In terms of inflation adjusted, which you must do given its huge rise in the last 10 years, the Dow is at about 8000. Measured in Euro’s, in aint much better. And dont consider the CPI anywhere near accurate for inflation measurement. See http://www.shadowstatistics.com for accurate inflation and unemployment numbers.
We are about 10 years into commodities bull market and they historically last 15 to 20 years. What’s more important, they’re always inverse to the equities market. The US Govt has flooded the global financial system with so much US$ since 2001 that the dollar has been blown away. So this makes measurements in nominal $ very misleading. It’s also why almost every asset class has gone up in the last 8 years!! This is a VERY unusual event. And our extreme inflation explains why. Give a read to Marc Faber as well. He’s had some great insight in the last 10 years.
At any rate, given that the Fed will continue to print $$ and the commodities market is far from over, we should see oil and other commodities continue to rise despite the global recession that starting happen. This was the case in the 1970’s. It is comforting to see supply/demand maintain it’s power in the market despite all the attempted manipulations by central bankers and large money managers! My 2 cents.

[peterb]

For insight about the stock market, commodities and the housing market, check out Jim Rogers last book. I think that Chris Puplava just wrote a very good article on it as well. In terms of inflation adjusted, which you must do given its huge rise in the last 10 years, the Dow is at about 8000. Measured in Euro’s, in aint much better. And dont consider the CPI anywhere near accurate for inflation measurement. See http://www.shadowstatistics.com for accurate inflation and unemployment numbers.
We are about 10 years into commodities bull market and they historically last 15 to 20 years. What’s more important, they’re always inverse to the equities market. The US Govt has flooded the global financial system with so much US$ since 2001 that the dollar has been blown away. So this makes measurements in nominal $ very misleading. It’s also why almost every asset class has gone up in the last 8 years!! This is a VERY unusual event. And our extreme inflation explains why. Give a read to Marc Faber as well. He’s had some great insight in the last 10 years.
At any rate, given that the Fed will continue to print $$ and the commodities market is far from over, we should see oil and other commodities continue to rise despite the global recession that starting happen. This was the case in the 1970’s. It is comforting to see supply/demand maintain it’s power in the market despite all the attempted manipulations by central bankers and large money managers! My 2 cents.

[peterb]

For insight about the stock market, commodities and the housing market, check out Jim Rogers last book. I think that Chris Puplava just wrote a very good article on it as well. In terms of inflation adjusted, which you must do given its huge rise in the last 10 years, the Dow is at about 8000. Measured in Euro’s, in aint much better. And dont consider the CPI anywhere near accurate for inflation measurement. See http://www.shadowstatistics.com for accurate inflation and unemployment numbers.
We are about 10 years into commodities bull market and they historically last 15 to 20 years. What’s more important, they’re always inverse to the equities market. The US Govt has flooded the global financial system with so much US$ since 2001 that the dollar has been blown away. So this makes measurements in nominal $ very misleading. It’s also why almost every asset class has gone up in the last 8 years!! This is a VERY unusual event. And our extreme inflation explains why. Give a read to Marc Faber as well. He’s had some great insight in the last 10 years.
At any rate, given that the Fed will continue to print $$ and the commodities market is far from over, we should see oil and other commodities continue to rise despite the global recession that starting happen. This was the case in the 1970’s. It is comforting to see supply/demand maintain it’s power in the market despite all the attempted manipulations by central bankers and large money managers! My 2 cents.

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