Inflation, deflation, subprime mortgage crisis, & banks

[JRMCNEA]

@lorax2013 why is deflation thought to be so destructive? when it is the correction to the actual production market after, hidden inflation is injected into it using the tool of fractional reserve Banking. Our ability to produce goods and services are inflated by paying in your example twice as much as the good is worth. Some times i feel like middle men are over paid and are draining out of our system more the the actual system is made to produce... why do we do this?...

[spectrum0590]

Wow! all about finance are all available in this video. It will make people understand about finance industry including real estate.

[NAUresistance]

Good video, very informative and timely.

Just wondering if you can list maybe 4 or 5 things of value that we could be buying instead..

Thanks!

[ThereAreNoSides]

As ever, very educational, telling us what officialdom would never tell us, and to some extent what the education system would never teach us.

Keep making this inspired content man!

Much love

[loraxpro]

Awesome!

[MusicMyLife2112]

Great video, I subbed.

[Brainman94]

So does property in Japan look like a good investment at the moment?

[anisiaram9]

the problem isn't in the system, the problem is with the people who bought more than they can afford from the banks who knew they couldn't afford it.

[wildnutria]

The builder need a bank loan to do so as well, it a bigger loop then this!

[daveextra]

i think your trying to grasp these questions sir but your very muddled. i think you have a lot more research to do in order to understand "the system". your on the right track but have somewhat to go yet. keep trying

[MachApocalypse]

I think he

JIZZED IN HIS PANTS.

[mannyfeseha]

thehelpfund.blogspot

[mimiwewe01]

I have just subscribe(12/9/08) to your videos, great great content. Keep up,you're truly a gifted being.

Are you a motivational speaker? You definitely have me motivated.

[Leshyj]

Great video! Thanks. Total support!

[valhala56]

Lorax, you people with money make me laugh. Putting a little cash in reserve if you can afford is great but you greedy folks think your going forever. You can't take it with you. As you well know with Peak Oil & the current geopolitical situation, everything can go to hell in a handbasket very quickly or over night. My suggestion is enjoy what you can now, cause either there will be no tommorrow or it will be so bad that some trinkets of gold/silver will not soften the hard landing we will see.

[FATCACAK]

you know whats going on, DO SOMETHING!! 'support the bank and homeowners protection act' propose it to your local government no matter where you are!

[ITILII]

you speak foolishly, grasshopper (as in the ant and the grasshopper who also just wanted to enjoy now and suffered for it later)

[valhala56]

Tell it to the people who just crashed on the plane in Buffalo. Your life sentence or ticket can be canceled anytime. I have some silver and gold put up, but believe me I try to enjoy the now as much as possible because nothing but now is guranteed my friend.

BTW tell it to the folks who invested with Bernie Madoff, I think they themselves would call their investment "foolish"

Your wealth is an illusion that can disappear like most illusions do.

[Zorrachus]

True, you can't take it with you, but put it in the bank where it should be. Put it in a tax free savings account. I put 5000 dollars in buying gold and I more than doubled it in 6 months.

[tegalans]

Holy shit 15% inflation! At that rate in 5 years prices will have doubled. Even at 10% inflation in 7 years our dollar will be worth 50% less than it does today. That percentage is not substantial. In 50 years at 10% interest a gallon of gas will cost about 448 dollars and then 7 years later it will cost about 900 dollars a gallon. And I thought 3.50 was bad. Woodrow Wilson is indeed our worst president ever. We have to destroy the Fed before it's too late. You just made me support Ron Paul.:)

[blackiswhite1111]

I agree that cutting interest rates is an inflationary move, but can they cut interest rates below zero? It will come to a point where they will have to raise interest rates, thus causing deflation. Also, owning something of value isn't a very good idea in a deflationary environment because next year, that "item of value" will be worth less, at least in dollar amounts. If a deflationary depression happens, gold, oil, houses and cars will all plummet in price. I agree with most of the video.

[psbyowner]

i would define "thing of value" and Au, Ag, pt, pd because these are not taxable

[psbyowner]

hmmm no more m3.

[psbyowner]

thanks that clarifies alot.

deflation it is?

[Rationalific]

THANK YOU! I finally understand! This video led to the light bulb over my head finally glowing, in regards to deflation and interest rates. Your other videos, from peak oil to diet to precious metals are also great, and lead me to subscribe!

[moniequa]

Hi Lorax,

Will Ben cut rate again at the end of next month? Some people say that oil price is artificially inflated, what do you think?

[cleeisme]

where will the government be when my small business fails...will they bail me out...will other ppl pay for my mistakes...of course not so why does bear sterns get bailed out

[kmcl11]

the larger the entity the much more ppl stand to lose. it does not happen for every corp though as we all know.

[HalcyonRain321]

You suggest owning things of value while we ride out this storm. What exactly do you mean by that?

Very few of us have the kind of disposable income required to buy things like gold, land and other things of value, outright.

What do you suggest for the poor working sap?

[BanjoNaps]

Eliminate waste.

[lorax2013]

I agree with BanjoNaps - eliminate waste is a great first step. I also think almost anyone can save at least a little if they want to. Silver only costs $17 an oz. Still I sympathize with anyone on a low wage - after almost 100 years with a central bank, most people are basically indentured servants nowadays.

[moniequa]

Stop going to Starbucks.

[HalcyonRain321]

i'm not a starbucks kinda girl . . .in fact, i don't even drink coffee.

[shellysmistik]

coffee is gross

[Hollander909]

POLITICIANS are the crib of the economic engine and are responsible for all rises in inflation all reforms and vetos and revolts and societal poverty! presidents are the ones responsible negating property rights through legalised extortion such as rising taxes rising home costs (when wallstreet can) all forms of cost inflation and rising costs is politicaly engineered! dont be swayed by lies

and bullshit that renders innocent politics from the societal collapsing effects it creates!

[moniequa]

Lorax,

When will our economy recover from inflationary fest?  How long should one hold on to gold? I hope you can help.

[lorax2013]

My opinion is that high inflation will continue for years. I think it won't begin to change until the prime rate is above 8%. At that point you should hopefully see M3 growth hit an inflection point rather than rise exponentially as it currently is. There are a lot of other factors however, and this is really only an issue for speculators. As always, for normal people trying to retain the value of savings, I recommend buying and holding anything of value and not trying to predict the markets.

[moniequa]

Thank you for your response.

[TomsFriendKake]

I have been watching your videos for awhile and you are one of the most sane and rational people I have ever seen on YouTube AND more so than even most people I know in person. I wish I knew you in person. I try telling all my freinds and family about most of the things you cover in your video's and they look at my like I'm from onother planet, and then will talk about American Idol or about how their boyfriends did something selfish or mean AGAIN but still they never solve anything.

[DepressionInsurance]

Wow...Great information all around, where would be a good place to look for true M3 stats? Thanks Brian

[Zhuangyao]

CPI is 0%.

[DOLLARCRASH1984]

Central planning (FED) is communism.

[voglbop]

nice video, thanks

[ZeketheSwede]

Sorrow is knowledge: they who know the most,

must mourn the deepest over the fatal truth-

The tree of knowledge is not that of life.

[jdcremin]

Lorax - I recommend going with a full beard. At your recent rate of video production, I'm expecting 4 inches by the next one :) Any new thoughts on peak oil?

[globehunter2]

You are a extremely wise and knowlagable man'

keep up the great work we need people like you.You Math skill is awesome. Thankyou

[rseveran]

Big problem is the loss of confidence worldwide in the USD. Foreign countries are getting tired of supporting the dollar. This is leading to higher and higher prices on imported goods. Now if we didn't import so much stuff (i.e. oil), that might not be a big deal. But we do. Inflationary recession at this rate.

Yes isn't it convenient that they stopped reporting M3. Who do they think they are kidding?

[lorax2013]

I agree, IMO that is the biggest inflationary factor of all right now.

[mshoque]

Awesome knowledge of economics and international finance. Thank you and keep up the good work. Syd

[hsuehc]

Awesome video. You make this seemingly complex subject into something so simple that an average joe like me can understand. Always enjoy your video. (What would youtube be without great contributor like Lorax2013.) We all look forward to more great analysis from you!

[dudeulartv]

really great video once again. i think you explain things so well. :)

[BrightAnarchist]

Great stuff, glad to see you back

[anilomd]

A succinct but very lucid explanation by Lorax once again. Bravo.

[MaverickCentricity]

Lorax is back. Great! I have been debating this very issue repeatedly in a number of places. I still think that this is going to be an inflationary event; however, the pullback in commodities has caused a lot of people to question their positions. Many of the bears are divided when it comes to what is going to occur with the money supply.

[hermease]

Nice way to explain this, and excellent video, Lorax. By the way, where is the forum for people who would like to discuss ideas you present?

[lorax2013]

You can click on the "groups" tab (hard to see against the background) on my channel page. Not much use of this group discussion though, so probably easier to just discuss here under comments.

[Pikers81]

Another great vid from lorax

[kjaheo]

No offence, i like your videos, the way you put atheism and religon in a peacefull way ( many fails at it) and i am glad to see you on the screen.

But because off the digital camera fuzz, i just have to tell you that just maybe you are going to be called a "reptilian" i know it is funny.

While i am on it by the way, could you tell us about the reptilian theory, would be glad to hear from your perspective...

[lorax2013]

Uh Oh, I'm busted...

Yeah, for some reason the fuzz looks a lot worse after posting - I'll try to fix it next time.

As for the "reptilian theory" I think it is one of the most interesting cultural myths. I trace it back originally to the old TV show "Lost World", then thru "They Live", and "V". After awhile any theme on TV, true or not, makes its way into public belief IMO.

[jdcremin]

Don't forget about the Sleestacks (land of the Lost):)

[SolitonPL]

Global Ponzi Scheme created by international banksters!

[stevo35972]

I love the goatee, dude

[cjlee41]

good video lorax

what is your thoughts on precious metals at the moment?

[jclayton59466]

I'm willing to bet that buying Gold when it is at an all time high, would be a bad idea.

[cjlee41]

how do you know gold will not continue to rise under the current conditions?

[jdcremin]

Doesn't it have to? As long as money supply increases so does gold. The new money has to go somewhere - and if we're in an inflationary recession it won't go to stocks. I see gold as a bridge to obtain something of REAL value - arable land with a water supply.

[joshrain1]

lorax where have you been. you look cool and nice video. always look forward to your videos.