atlasapple

Housing's Big Picture Isn't Pretty

Re: Deflation

Gresham's Law should become part of everyone's economic vocabulary.

We may see deflation in many assets but inflation in staples like food and water.

It's my feeling that we will continue to see a huge inflation in Cash prices but offsetting deflation in Credit prices. Think of the CPI as averaging the two hence the disinformation of current low inflation be reported.

We all know the distortions of the current CPI but just simplify the basket of goods to see the problem when including both necessities and luxuries in the sam inflation metric.

2006 - Bread - $1 per loaf, 30" Flat Screen TV - $1000
2009 - Bread - $2 per loaf, 30" Flat Screen TV - $500

In 2006, $3000 would buy 1000 loaves of Bread and two 30" Flat Screens

In 2009, $3000 would buy 1000 loaves of Bread and two 30" Flat Screens

Hence no inflation, as long as you can eat a Flat Screen TV

Should Wall Street Have Saved Itself?

RE: vboring

I remember Buffet and BKR looked at with disdain during the height of the internet bubble. They were as being behind the curve. Those who dissed BRK were wrong of course but they are still getting a billion dollar bailout after booking billions in profit from 2003 - 2006.

The lesson is simple, make money steady and slowly like BRK or be reckless enough to ensnare the sheeple and get out when the s&#t hits the fan.

TBTF is the new version of a early 1900's trusts; inevitable without regulation and destructive to capitalism in the end.