We are in a Deflationary Depression

[stuttgurth]

ye only the cream of the crop companies that we bailout and give massive tax breaks to will survive lol.

[Homocystine]

I agree.....

[openureyes911]

Ok, my understanding is that we are in a deflation due to the fractional banking system which creates 85% of the available credit / base money is being payed down by the public as they are nervous about the future. However prices are rising, a symptom of inflation, this is due to the low interest rates causing people to invest in equities and commodities which filter through to everyday living.

So I think this will end in a complete loss of confidence in all fiat currency and then hyperinflation

[openureyes911]

Ok, my understanding is that we are in a deflation due to the fractional banking system which creates 85% of the available credit / base money is being payed down by the public as they are nervous about the future. However prices are rising, a symptom of inflation, this is due to the low interest rates causing people to invest in equities and commodities which filter through to everyday living.

So I think thish will end in a complete loss of confidence in all fiat currency and

[Zyworski]

I f the businesses have all the money and people have none the solution is quite easy and I am surprised no one can see it, tax the piss out of them. Now businesses are too smart to get caught paying taxes, they will just make capital investments, create jobs and the people get money anyhow in a win win scenario.

Every time I hear one of the pundits say don't raise taxes in a recession I know that they are bought and paid for, raising taxes in exactly the right course.

[Ben1607]

alex jones is here to emotionally program us. that is how we are controlled. emotions.

[shiffty1032231]

With the fed printing machine going wild we are going into mass inflation. Its masqueraded as deflation because of the banks and businesses not loaning creating real products for export and jobs. Since the fed has not stopped it and let the deflation process continue the value of our money is going to drastically drop with the prices of goods drastically rise while our pay does not creating at first a inflationary depression only longingly ended by deflation as the fed stops their practice.

[vladtheimppaler]

just goimg to get worse

[davfritz]

Get ready for a wild ride boys..... YEAHHHAAAA!!!

[darthmorgen]

Great video! ty

fear not a global currency will solve all ills, by conquest or consent

[canadianraccoon]

How long will this last 1 year 2 years???The Alt A mortgage are coming up...lots more foreclosures going down the pipe.

[endlessmountain]

defl depression is pretty much over, and maybe up to six months left. However, its still unsure for me if there is going to be a deflation or inflation bomb.

Either way, I think 4 years or so of hard times until the recovery. Some doom and gloomers think a decade or two. However, the energies that I use (sort of astrology base) would say early 2013 as a recovery.

[AM429]

can we wait it out in canadian or australian dollar funds then?

[endlessmountain]

maybe a little longer, but out dollars are still fiat and we are still slaves to and the probable odds is that we eliminate negative culture in our life and this is one of them.

Holding a basket of currencies is a decent strategy now. Some like to hold half euro and half USD to take away the swing moves.

[herbs814]

Canadian and Australian populations have the same (or worse) demographic weaknesses as the US and UK does. Plus, deflation would hurt nations that rely on commodity income (Canada and Australia).

[psalmistjoeldavid]

I have heard it said that in a deflationary period people end up losing their jobs because the company's profits are not high enough. Well maybe if the CEO's and those in the higher tier of the company would live on less those people could keep their jobs!!!!

[herbs814]

50% off, 70% off, even 90% off. "90% off jewelery" (jewelery, like gold, could be seen as a store of value against inflation -- if there were plenty of currency to part with). For all the talk of stockpiling, there is also much evidence of people declining to spend (or remaining indecisive).

housing fell 20+%, sp500 fell 50%, silver fell 40%, oil fell 50%.

All the inflationary money seems to be hoarded by the banks. Velocity of money is slow, even if the volume is greater. Cash is king now.

[skudlick]

A real truism for sure,temporarily. After the inventory selloff and deleveraging. Repleneshment of inventory from your suppliers will start to command more and more dollars as companies try to remain solvent.There will still be a need of goods and services but the amount of goods will be diminished, ergo, higher prices. Competition will ensue and the business cycle will start all over again. Unfortunately, this will take years to come full term. Buy some silver and gold

[sonnybrakes]

Not to mention package being reduced in size while the price stays the same.

[siddhaam]

Alot of that inflated money supply is not going into the consumer economy...it's going into the black holes in the balance sheets of the banks...effectively disapearing as soon as it's created...like pouring water onto sand.

The deflation is being fed by inventory liquidation. But imports are down so it's just a matter of time before the tide turns and inflation begins.

What do you think?

[StrafingMoose]

Banks will do what they always did, loan money. It's just a matter of time. Unless they understand they can't loan more money than the total of goods/services avail. on the market and loan out that money as real growth picks up, they'll flood the market with phony money.

[herbs814]

Banks are indeed keeping much of the "stimulus" to pad their balance sheets, both here and offshore. (Of course, when the government suspects that we might save our money instead of spend it, they use that as an excuse not to cut taxes or not to give out rebates.)

If the dollar stays strong, we can import again (although this only extends our dependence on imports). If the dollar weakens, imports will become more expensive; then we might just have to produce for ourselves, or do without.

[siddhaam]

Hi,

I dont think they are padding their balance sheets. Most banks are bankrupt and the bailouts are just disapearing into their losses. The only reason the banks are still open and the ATMs work is because everyone is nodding and winking and adjusting their accounting methods.

The dollar will probably collapse, which will lead to a new global reserve currency. That is the primary goal of this crisis - a new global reserve currency managed by a new global central bank.

New World Order!

[herbs814]

What do you think padding their balance sheets means? The "stimulus" cash they get is used to cover losses, both now and in the future (more adjustable rate loans will adjust upward, more loans will go into default).

Banks need more cash because the "regulators" are belatedly becoming more vigilant about minimum reserve requirements. Of course, they won't admit that fractional reserve banking is the source of our problems; they won't move toward 100% reserves, fully backed by precious metals.

[siddhaam]

I thought you meant they were stashing the cash...whereas in fact it is literally just vanishing into their losses...which are mounting daily due to asset deflation and defaults.

At the moment all regulation is off...everyone is looking the other way. The banks are being allowed to alter accounting practices so as to avoid collapse. In fact they are bankrupt. If there was real enforcement of regulations the whole system would collapse.

It probably will...soon...when they are ready.

[herbs814]

which means that we had better be ready.

dailyreckoning (dot) com/weekend-at-bernankes

[herbs814]

The pro-government, pro-democrat, elitist media tells us that the problem is insufficient regulation. The truth is that regulation is not meant to protect us; regulation is a weapon selectively used by the elites to protect the establishment, while squeezing out small business / "new money".

[siddhaam]

Yes the problem is not small business, it is the banking dynasties and corporations. They have usurped government - literally bought it - particurally in America. The primary constituency of your politicians are the corporations who fund their election campaigns. 1+1=2.

Legislation & regulation is enacted in gov; but the will driving it lies outside gov in the think tanks of the elite. Most unelected positions (eg. treasury) are filled by their people. Geitner is the Fed's man.

[m6996j]

I agree, well said my friend.  love and peace mik

[steadtfreddy921]

common dude this is nowhere a depression , if we get there it will be much worse. Just don't forget how easily money supply is controlled - if i would were you i would latch on to the money spray and benefit.

[clearasvodka]

True. Many people have no idea what all this means. They assume recessions happen and then we just move on. Unfortunately we have printed more money than at any time in human history. This in a span of just 6 months. We have doubled our money supply and there is more to come. Potentially another 1 Trillion will be printed in 2009. High inflation is inevitable.

[yz250thatownsyou]

this deflationary depression is just the begginning, the hyperinflation will hit us like a train going 100mph

[capcom101you]

Good presentation. Thanks for providing this informative analysis on current economics.

[budb11]

I've heard it said that high inflation is always accompanied with corresponding rises in wages. What do you think?

[herbs814]

Those who make themselves highly attractive will command higher compensation. Those who don't, won't.

[NibiruMagick2012]

nice

[vention4wh]

So even though prices are going up slightly on a few things, you're saying that it's deflationary since there is so much more money available that the actual value of the currency that you buy the products with is going down, so it's deflationary. So basically unless you're getting big pay increases it means you're getting a pay cut every month.

I can understand why the stock market is going up. A lot of the super rich stash their money there and the super rich are the only ones with money now.

[endlessmountain]

im saying it is a case for evidence

we are seeing the housing prices lower in nominal value along with oil, gold and so many other things lower that this is giving proof of deflation.

Now if they increase the money supply 10x and the prices go up 4x then its inflation i think.. that is a common sense thing.. but with 2x money supply and a 4.99 product going to 5.59 is deflation in my opinion

[BarrySlisk]

@endlessmountain

I would call it inflation and rising prices. So, inflation using both the old and new definitions (expanding money supply and rising prices).

I see your point though. I just think we should minimize the amount of meanings of one expression.

[popcur]

Nice presentation. Kudos.

[POSSUMTOHIDE]

Good analysis of this crisis with presentation! If it wasn't for you and others here on you tube, I would have no idea of the magnitude of this crisis- I have been prepping, saving money, paying off debt, etc. Thank you !!!

[talagor]

Good stuff!

[UDoHaveMyName]

wow, nice presentation

[FelipeSparx29]

Thanks for the upload

[solojam]

u nailed it on the head when u said companies are going out of business so they are liquidating everything and raising cash, this is why we are deflationary right now, once everything is wringed out so to speak we are going to be inflating prices bigtime, stock markets will go into bubble mode again but this time prices are going to skyrocket for everything, and once this bubble pops we will see another great depression

[endlessmountain]

thanks

[jordan2tagg]

Another great analysis by Derek. Man if you were making seminars one day I would come all the way to Canada for sure :).

Derek what about the time frames on this subject, when do you think the inflation will set off? When is it time to get out of cash?

[endlessmountain]

i recorded some stuff on that also today.. but im uploading that tommorow.

[ldmw6]

Great presentation, thank you

[Silberhorter]

I call deflation because your CPI figures are negative and 50 trillions of wealth has been blown away while only 13 trillions were handed out to broken zombie banks and I call hyperinflation because of foreigners completely leave your phony economy which leads to a run on your 70% foreignly hoarded USD and to hyperinflation. Your Bennies and Timmy Boys and Emporer to decide how ro ruin the world in next move. broken $ would be burdened by foreigners (the usd is our currency but your prob..)

[Cneumann22]

Great vid. Thanks for all your assistance and knowledge sharing.

[slobomotion]

Save and invest systematically and diversify. Be frugal. Avoid debt. Have good insurance and contingency plans. Be prepared to change professions, to move elsewhere in the world.

[Freemarketeer81]

Agree.

[wcarlpdrysdale]

the helicopters will be delivered after payment in Chinese Jwan .

then ben will lode them up in fed-notes , and then we'll be Zimbabwe style millionaires :)

[Frequencitee]

-Derek

You have been a Tour d' Force of late. Thank you for taking the time to synthesize a complex scenario.

There are four basic elements which comprise methods of comprehension. Theoretical, methodological, cognitive and application. You're running on all four cylinders.

Thakn you.

[endlessmountain]

its been fun

[unworldlything]

thanks

[mrslgd47]

Thankyou

voice of " Common Sense"

I always enjoy your VIDS

[endlessmountain]

common sense is what it seems like to me.

Last year it was the stock market that i was concerned with.. now its the dollar.

[chromedreamz]

good point on 'where is all the money' they print trillions and I dont know anyone who has any money

[chromedreamz]

inflation/deflation seem easy, but complicated- how can they increase the money supply like they did and not be in inflation, well guess thats whats happening-guess u can beat inflation with a helicopter

I dont believe hyperinflation will come to U.S, albeit it will be bad

[mongobobo]

Increasing the money supply is one thing. Money velocity is quite another.