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Deflation or Hyperinflation...Look to the 30 year bond

 
Anonymous Coward
User ID: 2993
United States
02/11/2008 01:28 PM
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Deflation or Hyperinflation...Look to the 30 year bond
The deflation 101 thread that I posted early has sparked quite a debate on whether we are headed into deflation or hyperinflation. Both sides have very valid arguements. However we have one vehcile which can give us more of a clue than any posters evidence or lack thereof.

Learn to watch the yield on the 30 year treasury bond.

The reason for monitoring this item is that it will most likely be the best performing asset in a deflationary environment when interest rates will decline and the value of bonds will rise. Conversely in a hyperinflation these bonds will be amongst the worst investments.

The last low on the 30 year was 4.3 in 2003. Dipping below 4.3 on the yield would be an indication of incipient deflation. In 2008 the 30 year yeild dipped to 4.1% I think the bond market is making it quite clear what they see on the horizon.

In hyperinflation all bonds, cash and financial items will be valueless. Interest rates will rise to extremely high levels.

To make it as simple and crude as possible:

A price above 121 or greater on the 30 year would signal deflation while a decline below 102 would be the first serious sign of significant inflation to come possibly leading to hyperinflation.

Yield below 4.3-4.1 =deflation
Yield above 5.6-5.9=inflation maybe hyperinflation


Today's rates

Price 99.00 yield 4.42

We are currently closer to a deflationary environment in terms of the 30 year bond.
Anonymous Coward
User ID: 33998550
Australia
02/09/2013 07:36 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
^^^^^^^ Oh, if only we'd listened to that young man, instead of walling him up in the abandoned coke oven
Anonymous Coward
User ID: 32213631
Ireland
02/09/2013 10:26 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
^^^^^^^ Oh, if only we'd listened to that young man, instead of walling him up in the abandoned coke oven
 Quoting: Anonymous Coward 33998550
Anonymous Coward
User ID: 32213631
Ireland
02/09/2013 10:26 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
^^^^^^^ Oh, if only we'd listened to that young man, instead of walling him up in the abandoned coke oven
 Quoting: Anonymous Coward 33998550
Anonymous Coward
User ID: 33995038
United States
02/09/2013 10:27 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Deflation. Why? The single most expensive things people purchase in life are homes and education.

Technology is making both decline in value exponentially.
Anonymous Coward
User ID: 1096472
United States
02/09/2013 10:38 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
The deflation 101 thread that I posted early has sparked quite a debate on whether we are headed into deflation or hyperinflation. Both sides have very valid arguements. However we have one vehcile which can give us more of a clue than any posters evidence or lack thereof.

Learn to watch the yield on the 30 year treasury bond.

The reason for monitoring this item is that it will most likely be the best performing asset in a deflationary environment when interest rates will decline and the value of bonds will rise. Conversely in a hyperinflation these bonds will be amongst the worst investments.

The last low on the 30 year was 4.3 in 2003. Dipping below 4.3 on the yield would be an indication of incipient deflation. In 2008 the 30 year yeild dipped to 4.1% I think the bond market is making it quite clear what they see on the horizon.

In hyperinflation all bonds, cash and financial items will be valueless. Interest rates will rise to extremely high levels.

To make it as simple and crude as possible:

A price above 121 or greater on the 30 year would signal deflation while a decline below 102 would be the first serious sign of significant inflation to come possibly leading to hyperinflation.

Yield below 4.3-4.1 =deflation
Yield above 5.6-5.9=inflation maybe hyperinflation


Today's rates

Price 99.00 yield 4.42

We are currently closer to a deflationary environment in terms of the 30 year bond.
 Quoting: Anonymous Coward 2993


How do you come to that conclusion? You provide two indicators, one which points to deflation (yield of 4.42 which is threatening the 4.3 mark) and the other points to inflation (Price 99.0 which is below the 102 mark).

This sounds like stagflation, in which case the only safe investments are in KY and petroleum jelly.
teslafire

User ID: 34421530
United States
02/07/2014 08:56 PM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
bump
Anonymous Coward
User ID: 57560793
United States
07/03/2014 12:32 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Treasury Yield 30 Years (^TYX) 3.47 Up 0.07(2.09%) Jul 2 2014
[link to finance.yahoo.com]
Anonymous Coward
User ID: 59718126
United States
07/03/2014 01:01 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
If OP is right, and deflation is coming, that explains why everyone is telling people to "BUY A HOUSE NOW! Get into a mortgage at that low rate!" Once the deflation hits even with a good job you won't even be able to afford the payments.
Anonymous Coward
User ID: 770992
United States
07/03/2014 01:11 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Gd dammit OP is just another stupid fucker.

1. Deflation is the lack of credit in the system. Borrowers private stop borrowing and private lenders pull in there hirns.

2, Inflation is currency destruction by the excess issuing of credit by government means. Cnetral banks backed by government coercion.

3. The US dollar can not be hyper inflated out of existence: A-Their are too many hundreds of trillions, even quadrillions of dollars sloshing around the world in the form of derivative debts etc.
B- The dollar has already over a century lost 98.5 percent of its value.

The process of the dollar losing value will continue into the next 100 years if the system survives.

Imminent dollar doom is a pile of shit. OTOH 2000 dollar gold and higher is inevitable.
Anonymous Coward
User ID: 50023016
Canada
07/03/2014 01:43 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...


Anonymous Coward
User ID: 770992
United States
07/03/2014 02:12 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/


You were taught by an idiot. US Dollar hyperinflation is impossible.
AZ40
User ID: 56276451
United States
07/03/2014 02:16 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/



Good thought.
Anonymous Coward
User ID: 59022802
United States
07/03/2014 02:16 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
The deflation 101 thread that I posted early has sparked quite a debate on whether we are headed into deflation or hyperinflation. Both sides have very valid arguements. However we have one vehcile which can give us more of a clue than any posters evidence or lack thereof.

Learn to watch the yield on the 30 year treasury bond.

The reason for monitoring this item is that it will most likely be the best performing asset in a deflationary environment when interest rates will decline and the value of bonds will rise. Conversely in a hyperinflation these bonds will be amongst the worst investments.

The last low on the 30 year was 4.3 in 2003. Dipping below 4.3 on the yield would be an indication of incipient deflation. In 2008 the 30 year yeild dipped to 4.1% I think the bond market is making it quite clear what they see on the horizon.

In hyperinflation all bonds, cash and financial items will be valueless. Interest rates will rise to extremely high levels.

To make it as simple and crude as possible:

A price above 121 or greater on the 30 year would signal deflation while a decline below 102 would be the first serious sign of significant inflation to come possibly leading to hyperinflation.

Yield below 4.3-4.1 =deflation
Yield above 5.6-5.9=inflation maybe hyperinflation


Today's rates

Price 99.00 yield 4.42

We are currently closer to a deflationary environment in terms of the 30 year bond.
 Quoting: Anonymous Coward 2993


How do you come to that conclusion? You provide two indicators, one which points to deflation (yield of 4.42 which is threatening the 4.3 mark) and the other points to inflation (Price 99.0 which is below the 102 mark).

This sounds like stagflation, in which case the only safe investments are in KY and petroleum jelly.
 Quoting: Anonymous Coward 1096472


I agree - what we are living in now meets the definition of stagflation...

If the rocket scientists in control continue on this path we may undergo HYPER-STAGFLATION.

This would be a scenario where everybody is unemployed, consumer credit is non-existent, everyone is homeless and yet the prices of everything go through the roof.
Anonymous Coward
User ID: 37974698
United States
07/03/2014 02:17 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/


You were taught by an idiot. US Dollar hyperinflation is impossible.
 Quoting: Anonymous Coward 770992


Thanks for that as well as your other post above. It's refreshing that someone gets it without wasting typing a thousand words, particularly here where every other moron drops the phrase "weimar republic" like it makes them seem smart.
Anonymous Coward
User ID: 59860066
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07/03/2014 02:25 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
when they start charging iphones $30,000 ..i think technology has skyrocketed or hyperinflationbanana
Anonymous Coward
User ID: 56876886
Sweden
07/03/2014 02:36 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/


You were taught by an idiot. US Dollar hyperinflation is impossible.
 Quoting: Anonymous Coward 770992


If you think that comment made you some genius, it didn't.
How about writing actual motivations and arguments instead of insults?
Anonymous Coward
User ID: 50023016
Canada
07/03/2014 02:38 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/


You were taught by an idiot. US Dollar hyperinflation is impossible.
 Quoting: Anonymous Coward 770992


Thanks for that as well as your other post above. It's refreshing that someone gets it without wasting typing a thousand words, particularly here where every other moron drops the phrase "weimar republic" like it makes them seem smart.
 Quoting: Anonymous Coward 37974698



lmao



I hope you girls get paid well. Shits and giggles only go so far...




Anonymous Coward
User ID: 62886924
United States
10/08/2014 10:36 PM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Treasury Yield 30 Years (^TYX) 3.06 Up 0.01(0.20%) 2:59PM EDT Oct 8 2014
[link to finance.yahoo.com]
Anonymous Coward
User ID: 65977660
United States
01/05/2015 10:05 PM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Treasury Yield 30 Years (^TYX) 2.61 Down -0.09(3.41%) 2:59PM EDT Jan 5 2015

[link to finance.yahoo.com]
Anonymous Coward
User ID: 66627208
United States
01/05/2015 10:17 PM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
I was taught to watch for the "deflationary headfake". We get what looks like deflation, and then massive hyperinflation...



 Quoting: /SleepingVillage/


You were taught by an idiot. US Dollar hyperinflation is impossible.
 Quoting: Anonymous Coward 770992


Someone that has no idea what a credit default swap is.
As long as the money printing continues, to support the debt you're OK. Once you stop the music, it's lights out.
Get a little understanding of the monetary policy and the debt structure of the US dollar and then come back and teach us a few things.

M'k
forestandtrees
User ID: 66698908
United States
01/06/2015 01:20 AM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
It's light out and the music is about to stop.


Watch closely the next ten days.


How would the world operate in an environment of no interest rates?


A: Very differently, after a period of "adjustment."
Anonymous Coward
User ID: 65977660
United States
01/18/2015 12:35 PM
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Re: Deflation or Hyperinflation...Look to the 30 year bond
Treasury Yield 30 Years (^TYX) 2.43 Up +0.02(1.00%) 2:59PM EDT Jan 18 2015

[link to finance.yahoo.com]

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