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Thursday Outlook: Another Bubble?

nice thinking -tip and tbt - I will add to tips (already in tbt)
Do you think WIP etf would add a possible hedge to the dollar decline?


On Mar 19 09:26 AM Chris B wrote:

> Let's hope for a return to inflation.
>
> The alternative is a Japan scenario or a depression, and an increase
> in the cost of servicing the national debt. I think the govt. gets
> this, which is why they are flooding the economy with dollars. If
> it takes a year or two of 8-10% inflation to get us out of this (which
> would only bring prices in line with what they would have been if
> deflation had never occurred) the government will accept that. After
> all, Paul Volker demonstrated that even persistent inflation can
> easily be killed by jacking up interest rates.
>
> I'm in TBT too, and took a decent hit (on paper) yesterday. This
> hit was perfectly offset by my gains (on paper) in TIP. Yet, in the
> long run, there is no contradiction in these investments. A return
> to even 3-4% sustained inflation would result in double-digit % gains
> to TIP prices and to funds that short regular treasuries that are
> currently yielding 3% for 20 years (!).
>
> The future has never been more obvious than it is now. The government
> is nearly unanimous in supporting expansionary policy. We can see
> an uptick in inflation from a mile away - even if it only ends up
> as a return to earlier low single digits levels. Yet, opportunities
> to exploit this dynamic abound.