[el oro]

You must assume that things that equity analysts produce are self-serving because they are supposed to be.

That being said, I share the view of that document. I think people have been fooled by this bear-market rally into thinking we're in a slow recovery.

Yes, China will be the biggest consumers of these "real things". They've been slowly accumulating it over the past several years. But, unfortunately, commodities will not rise because of economic recovery causing increasing world demand. Instead, commodity prices will increase as the world loses trust in fiat currencies and want to diversify out. That is how commodity prices will potentially rise substantially while the world remains in recession/depression.

The USD will be inflated and since it is the reserve currency, will export the inflation to the world.

 

[el oro]

Inflated with hot air? I concur. However, if you mean propped up that makes your last sentence incorrect. As you may have noticed last year inflation is exported when the USD drops.

And the USD dropping is a result of inflation so I guess we agree, eh?

 

[el oro]

I find it interesting that even among a small group of very smart individuals, we have different opinions and hence a market. It goes to show that how difficult it is to forecast future economic trends with high odds of being correct.

Yup, if everyone agreed then we'd probably be wrong . And it`s way more interesting this way.

Bear market rally? I think the market is stuck in a range and deflation, not inflation, continues to be the concern. When people at the treasury stop talking about "things getting better" is when they'll actually turn around.

The unemployment rate isn't going down (quite the opposite from a report released yesterday) so I'm not sure where all these bears see inflation coming from when wages won't be participating and US consumers won't be buying. Sprott is a smart man, but he's paid by selling an opinion to his investors and makes his money by supporting that style.

Look at the whole picture; we're not going anywhere anytime soon.

In the US, June CPI was 0.7 compared to 0.1 in May. If you exclude food and energy, June CPI was 0.2.

Price inflation on the things Americans need: food, energy etc.
Price deflation on American's assets: real estate, stocks and bonds, cars etc.

More unemployed Americans = less tax revenue to pay for ever increasing spending by the government. So, money has to be printed to make up the difference. It`s just a matter of time before inflation KOs deflation.

I`ve looked at the big picture and it ain`t pretty!

 

[el oro]

Everyones mind contains a different picture.

Yours is a bad one , but dont try to pass it off as THE picture.

My picture is looking pretty rosy.

If you knew the big picture , you'd be way ahead of the rest of us and not so pessimistic.

True. I just don't want to start/end too many sentences with "in my opinion".

You aint seen dick.

I have. Just not as much as you more experienced folks!

On the main point yes, on the chicken and the egg apparently not... as I already said you have it backwards... inflation is a result of the USD dropping. Get the chickens in a row and you can count your money a lot faster.

You're right but inflation came first, like the egg

 

[el oro]

"The analogy I use sometimes is, we had this beautiful house. And there was a fire. We came in and we had to hose it down. The fire is now out, but what we've discovered is, we need some new tuckpointing, the roof's leaking, the boiler's out, oh, and by the way, we're way behind on our mortgage," Obama said.

So, what was the fire or what caused the fire? And what did they do to put it out? Opinions?

I bet the president claimed "the fire is out" in the first bear market rally of the great depression.

 

[el oro]

CIT was saved by it's own bondholders as they would stand to lose $$$$ if they filed for bankruptcy due to CIT being a recipient of TARP funds last year. If they let CIT fail, many Americans will be affected greatly so I didn't see it happening.

There are multiple banks failing every week in the US, just not big enough to be on your radar. Maybe no more big banks will fail. But a headline from a couple of days ago read "Morgan Stanley sets aside 72% of revenue to pay bonuses". Like the old saying goes... a stupid robber robs a bank, a smart robber becomes a banker.

I think we've yet to see the end of the effects of financial weapons of mass destruction such as OTC derivatives.