brilac Posted October 21, 2021 Share Posted October 21, 2021 (edited) I felt it when buying groceries last week and over the previous weeks. When a deal hits, I buy. Like $1.28 for cheese. I bought 5 packs of cheese. I was at the grocery store last week and besides some of the shelves being empty due to the supply chain shortage, the prices were high and I did not buy some things due to the price. I feel it in my heating bill too and rent. When my lease renewed last spring, I negotiated and knocked off almost $200 per month, but that was in my favor due to what other places were offering, but rent is high in Seattle and surrounding areas. Edited October 21, 2021 by brilac 1 Link to comment Share on other sites More sharing options...
Elias Pettersson Posted October 21, 2021 Share Posted October 21, 2021 (edited) On 10/20/2021 at 2:58 PM, nuckin_futz said: The only thing that could crash the stock market is a rapid rise in interest rates. With governments around the world running massive deficits and controlling interest rates that isn't going to happen. Look at the Fed's overnight repos. They are currently consistently in the $1.5 trillion dollar range. The repo is a reverse lending facility where Investment banks and dealers lend money to the NY Fed overnight. They have so much friggin cash sloshing around they lend the Fed $1.5 trillion each night and the Fed gives it right back to them with .05% interest per annum. How does any market crash when there's literally at least $1.5 trillion dollars looking for a home? Where else is that money going to find any liquid yield apart from the stock market? I agree with this 100%. Normally interest rates are directly correlated with the stock market and with the real estate market. The real estate market also being driven by supply and demand of housing as well. However, in this particular case I think inflation will be a greater risk for the stock markets than rising interest rates in the coming months. If you look back at the last few stock market crashes they were all preceded by massive rising interest rates. However, historically rising inflation has been worse for the stock market than rising interest rates. The average rate of inflation historically is around 3%. When inflation is lower than 3% the S&P 500 averages over 16%. When inflation is higher than 3% the S&P 500 averages around 7%. Stocks do better historically when inflation is going down not up. The last 18 months is a perfect example. Inflation has been well below historical standards with a weakening economy but the stock market has been booming. Also, people tend to panic when things get really bad and consequently they move their money into safe spots. This might keep the real estate market from crashing as people tend to think of real estate as a safer investment than the stock market and a hedge against inflation. People might also just leave their money in cash until the uncertainty is over. According to billionaire hedge fund manager Paul Tudor Jones, he is saying that there is around $3.5 trillion in liquid assets right now ready to be moved somewhere. If inflation keeps going up that money could be moved to real estate, crypto, the stock market or it can just be consumed. Jones is still advising against investing in fixed income portfolios however. The 60/40 stock/fixed income portfolio should be avoided in this market. Paul Tudor Jones says inflation could be worse than feared, biggest threat to markets and society (cnbc.com) https://www.marketwatch.com/story/inflation-single-biggest-threat-to-markets-and-society-in-general-says-investor-who-called-stock-market-crash-in-1987-11634741843 ‘The No. 1 issue facing Main Street investors is inflation, and it’s pretty clear to me that inflation is not transitory. It’s probably the single biggest threat to, certainly, financial markets and again probably I think to society just in general.’ Edited October 22, 2021 by Elias Pettersson 1 Link to comment Share on other sites More sharing options...
Elias Pettersson Posted October 21, 2021 Share Posted October 21, 2021 7 hours ago, Russ said: How I feel the government wishes we would turn a blind eye to the last 20+ years of spending..... I love how the CRA will go after people for missed taxes but the government can print as much money as they want, go into as much debt as they want, and really just say "oh you know its in the best interest of the people" The federal election was a perfect example. That $600 million could have been used to feed the poor or help with many different things during this pandemic. Instead they used it to re-elect Trudeau to the exact same minority government he's had for the last 2 years. 1 1 Link to comment Share on other sites More sharing options...
Kurgom Posted October 21, 2021 Share Posted October 21, 2021 (edited) The idea that inflation can be fixed by not printing money isn't a reasonable assumption. We would have higher inflation without the injections into the economy almost certainly. No where on earth is getting through this without some major inflation, especially considering the manufacturing and shipping center of the world is going through some major economic troubles. I don't know how to "fix" it, and Canada's economy is robust enough that things should normalize in 2 or so years, but it's easy to point fingers without viable solutions for problems caused by global pandemics. Canadian policy makers have consistently let down Canadians on a lot of things, but the economy hasn't been one of them. Edited October 21, 2021 by Kurgom Link to comment Share on other sites More sharing options...
StanleyCupOneDay Posted October 22, 2021 Share Posted October 22, 2021 To be honest anyone who is living through COVID should have expected this. Vaccinations only started earlier this year. Up until that point a whole lotta people were social distancing and staying at home for the greater good to protect others from sickness or death. People did that for over a year. Putting off purchases, not going out, millions of us did this. Now imagine a year’s worth of demand for services, new purchases, travel, food etc. all coming back instantaneously. Demand outstrips supply due to a surge and prices rise dramatically. We really hadn’t felt any inflation since COVID because businesses were desperate to keep prices down to coax people to spend money, some prices even dropped. Now businesses are unprepared for the sudden rush and are raising prices to cash in and hire more people. It’s not a crazy number if you take into account the huge dip in demand during the COVID without vaccines year. I don’t know this for sure, but I’d bet this kind of surge in inflation occurred after every war we fought in ended. I’m just thankful that our government put a freeze on rent hikes and next year is only allowing a 1.5% increase. There’s a lot of people that would suffer if landlords could increase rent with no restrictions here in BC. Inflation sucks and definitely hurts people and I feel for those struggling, especially those who live paycheck to paycheck. There’s just not anything that can be done to stop it living in a capitalist supply demand system. Hopefully next year becomes the normal 2-3% average we’re accustomed to after the increased demand is satisfied this year. Link to comment Share on other sites More sharing options...
Russ Posted October 22, 2021 Share Posted October 22, 2021 On 10/21/2021 at 12:36 AM, Elias Pettersson said: The federal election was a perfect example. That $600 million could have been used to feed the poor or help with many different things during this pandemic. Instead they used it to re-elect Trudeau to the exact same minority government he's had for the last 2 years. Don't worry about it, the Feds will just print another $600 milll...... 1 Link to comment Share on other sites More sharing options...
MaxVerstappen33 Posted November 4, 2021 Share Posted November 4, 2021 On 10/20/2021 at 10:10 AM, RUPERTKBD said: Slowly coming out of a 2 year pandemic...global supply lines disrupted....taxpayer funded relief to millions.... The real surprise would be if inflation was not at an 18 year high.... But that's how all out of control inflations always start. There is always a finl crisis , war or something. Link to comment Share on other sites More sharing options...
taxi Posted November 5, 2021 Share Posted November 5, 2021 (edited) On 10/20/2021 at 1:23 PM, Warhippy said: Pay your bills carry no debt and you'll be fine if you don't go overboard What do you do when your bills increase in price dramatically and you're salary increases lag. The rich will be fine, particularly those that already own lots of assets and property. Everyone else will suffer. Edited November 5, 2021 by taxi Link to comment Share on other sites More sharing options...
Warhippy Posted November 5, 2021 Share Posted November 5, 2021 10 hours ago, taxi said: What do you do when your bills increase in price dramatically and you're salary increases lag. The rich will be fine, particularly those that already own lots of assets and property. Everyone else will suffer. You'll survive that far easier without hundreds or thousands a month in debt servicing 1 Link to comment Share on other sites More sharing options...
Warhippy Posted January 6, 2022 Share Posted January 6, 2022 18 year high...so far 1 Link to comment Share on other sites More sharing options...
Junkyard Dog Posted January 7, 2022 Share Posted January 7, 2022 What usually gives when inflation is high? Link to comment Share on other sites More sharing options...
Warhippy Posted January 7, 2022 Share Posted January 7, 2022 14 minutes ago, Junkyard Dog said: What usually gives when inflation is high? Usually peoples homes, credit and ability to debt service because they lived beyond their means 1 1 Link to comment Share on other sites More sharing options...
Junkyard Dog Posted January 7, 2022 Share Posted January 7, 2022 8 minutes ago, Warhippy said: Usually peoples homes, credit and ability to debt service because they lived beyond their means How does/can inflation balance itself out to normal levels. What’s the process that happens. Link to comment Share on other sites More sharing options...
nuckin_futz Posted January 7, 2022 Share Posted January 7, 2022 50 minutes ago, Junkyard Dog said: How does/can inflation balance itself out to normal levels. What’s the process that happens. Central Banks combat inflation by raising interest rates. 1 Link to comment Share on other sites More sharing options...
Warhippy Posted January 7, 2022 Share Posted January 7, 2022 44 minutes ago, nuckin_futz said: Central Banks combat inflation by raising interest rates. Thus ensuring anyone with savings actually earn off of those savings, but those who are just struggling and working their arses off get punished for it. The whole system needs to fail en masse for it to be fixed. 1 Link to comment Share on other sites More sharing options...
HI5 Posted January 7, 2022 Share Posted January 7, 2022 Curious to see how high and how fast interest rates rise. Link to comment Share on other sites More sharing options...
Warhippy Posted January 7, 2022 Share Posted January 7, 2022 1 minute ago, HI5 said: Curious to see how high and how fast interest rates rise. I had read that something like a 2% raise would be enough in the Toronto area to throw almost 70,000 people out of their homes as they would not be able to keep up with the increase in mortgage payments as they live paycheque to paycheque. This was about 18 months ago or so but I'd imagine that stands true. The same story or study said that a great number of people were essentially a multiple series of months of $200 more than what they bring in towards bankruptcy. If the government is smart they'll start slamming foreign ownership and corporate ownership restrictions on property purchases because the run will be spectacular. 1 Link to comment Share on other sites More sharing options...
Ilunga Posted January 7, 2022 Share Posted January 7, 2022 4 hours ago, Warhippy said: Thus ensuring anyone with savings actually earn off of those savings, but those who are just struggling and working their arses off get punished for it. The whole system needs to fail en masse for it to be fixed. What about those of us with savings that are working our arses off. That are self funded retiree's ? Am I getting punished receiving .1 percent on my savings ? $@$$&@ Eh I am. Link to comment Share on other sites More sharing options...
Warhippy Posted January 7, 2022 Share Posted January 7, 2022 2 hours ago, Ilunga said: What about those of us with savings that are working our arses off. That are self funded retiree's ? Am I getting punished receiving .1 percent on my savings ? $@$$&@ Eh I am. You better believe you are It's an amazing system in which unless you're essentially wealthy. Not like I own a house and an income property wealthy, but I own three homes a few income properties and my accountant deals with it wealthy, you're getting screwed. Living paycheque to paycheque. Oh no you're screwed Worked hard and saved a bit, too bad you're screwed. You're on the Panama papers list? Pass go collect $259k in taxpayer funded handouts 2 Link to comment Share on other sites More sharing options...
Ilunga Posted January 7, 2022 Share Posted January 7, 2022 (edited) I know I am lucky,mum and dad worked extremely hard and many sacrifices to be able to leave me the family farm. Like them I still give a chunk of my earnings to people less fortunate than myself even though I am classified as a low income earner and a parent. I really do have empathy/compassion for those that are battling just to get from paycheck to paycheck. As I have stated before the middle class is disappearing. The greed of today's plutocrats is $@#_@$. The biggest con of all is how they have convinced a large percentage of our populace their greed is justified. Edited January 7, 2022 by Ilunga 1 1 Link to comment Share on other sites More sharing options...
Recommended Posts
Please sign in to comment
You will be able to leave a comment after signing in
Sign In Now