2010-10-28 — blogspot.com
Last Summer, I predicted that a panic in Treasuries and a rise in commodities would lead to inflation, which would spiral out of control into hyperinflation. A lot of people said I was on drugs, at the time. Now? Not so much.
Forget about surging gold prices and the negative yield on TIPS: Oil has risen 20% year over year, grains including wheat and livestock feed over 33%—and those price rises are set to hit Main Street this coming winter.
I argue that inflation will begin in Q1 of 2011, with a 5% annualized rate by March. Then it will accelerate to 8% by July 1, 2011, 10% by October, 2011, and the hyperinflationary tipping point of 15% by March of 2012.
In my piece, I give the specific macro-economic reasons why I think this will happen, discussing commodity prices, the Currency War that is becoming a Trade War, the continued massive Federal government deficit, and the mishandled Federal Reserve policy of QE2—all of which combined augur for a collapse in the dollar.
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