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From Deflation To Hyperinflation

Expect a market crash followed by helicopter money
Wednesday, September 30, 2015, 11:36 PM

Executive Summary

  • China is rolling over
  • Contagion will eventually take down the core economies, including the US
  • We are witnessing a full-blown collapse of the commodity complex
  • Deflation will win the day over the next year, but then get ready for helicopter money hyperinflation

If you have not yet read Part 1: Deflation Warning: The Next Wave available free to all readers, please click here to read it first.

The Chinese GDP Lie

Right off the top, China is not growing anywhere near the 7% it claims.  That’s just a politically useful lie that the Chinese tell to the world as much as they tell to themselves.

Fortunately, hardly anyone is falling for that particular fib any longer.  Let’s start with the completely obvious manufacturing slump that has hit China:

Chinese Factory Gauge Slumps to Lowest Level Since March 2009

Sept 22, 2015

A private Chinese manufacturing gauge fell to the lowest in 6 1/2 years, underscoring challenges facing the economy as its old growth engines splutter.

A global sell off in riskier assets gained pace after the preliminary Purchasing Managers’ Index from Caixin Media and Markit Economics dropped to 47.0 in September. That missed the median estimate of 47.5 in a Bloomberg survey and fell from the final reading of 47.3 in the previous month. Readings have remained below 50 since March, indicating contraction.

Premier Li Keqiang’s growth target of about 7 percent for this year is being challenged by a slowdown in manufacturing and exports even as services and consumption show resilience.


The way a PMI reading works is anything over 50 indicates expansions and anything under 50 indicates contraction.  Anybody care to explain to me how China can be sporting sub-50 readings every month since March -- that’s five full months -- and still be claiming to be aiming for a 7% annual growth target?  You know, because China is... » Read more


Ivan Cholakov/Shutterstock

Deflation Is Winning – Beware!

Expect the ride to get even rougher
Friday, July 24, 2015, 10:03 AM

Deflation is back on the front burner and it's going to destroy all of the careful central planning and related market manipulation of the past 6 years.

Clear signs from the periphery indicate that a destructive deflationary pulse has been unleashed. Tanking commodity prices are confirming that idea.  » Read more



Philip Haslam: When Money Destroys Nations

Understanding how currencies collapse
Monday, March 23, 2015, 4:54 PM

To understand better the anatomy of a currency collapse, we talk this week with Philip Haslam, author of the book When Money Destroys Nations. Haslam is an authority on monetary history, and more recently, has spent much time in Zimbabwe collecting dozens of accounts of the experiences real people had as the currency there failed.  » Read more


Ralf Siemieniec/Shutterstock

What Is Money?: Crash Course Chapter 6

The world revolves around it, but it's poorly understood
Friday, July 25, 2014, 10:52 AM

Money plays an incredibly large role in the world, but yet it remains poorly understood. What exactly is it? What do the pieces of paper we hold in our wallets and bank accounts actually represent?

Developing an understanding of the underlying role of money allows us to better see when it is being used properly, or abused. And history shows that abuse is more the norm than the exception: the record shows over 3,800 previous examples of paper currencies that no longer exist. » Read more


This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 11)

If you don't want to wait, you can:


This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 2)

If you don't want to wait, you can:



FerFAL: Here's What It Looks Like When Your Country's Economy Collapses

Argentina is showing us the playbook in real-time
Saturday, February 8, 2014, 2:36 PM

Argentina is a country re-entering crisis territory it knows too well. The country has defaulted on its sovereign debt three times in the past 32 years, and looks poised to do so again soon.

Its currency, the peso, devalued by more than 20% in January alone. Inflation is currently running at 25%. Argentina's budget deficit is exploding and, based on credit default swap rates, the market is placing an 85% chance of a sovereign default within the next five years.

Want to know what it's like living through a currency collapse? Argentina is providing us with a real-time window.

So, we've invited Fernando "FerFAL" Aquirre back onto the program to provide commentary on the events on the ground there. What is life like right now for the average Argentinian? » Read more



Alasdair Macleod: Currency Crisis Dead Ahead

Introducing the 'Fiat Money Quantity' measure
Saturday, October 19, 2013, 8:23 PM

This week's podcast interview introduces a new monetary measurement developed by Alasdair Macleod: the 'Fiat Quantity of Money', or FMQ. Alasdair explains how FMQ is derived, as well as what it can tell us about the true levels of fiat money supply. In the case of the dollar, it reveals that levels are far above what is commonly appreciated – so far, in fact, that a currency crisis could arrive sooner than even many dollar bears expect. » Read more

Daily Prep

CPI Trends

Water Rates Are UP 18%

Are you getting ready for expensive water?
Thursday, December 13, 2012, 3:33 PM

Another sign of peak water on the horizon? Time to double up efforts to conserve and more wisely use this precious resource.

http://www.resilientcommunities.com/water-rates-are-up-18-are-you-getting-ready-for-expensive-water/ » Read more


Image by Calgary Review, Flickr Creative Commons

Jeff Clark: So How Many Ounces of Gold (or Silver) Should You Own?

Doing the math
Saturday, November 17, 2012, 2:00 PM

This week, Chris talks with Jeff Clark, Senior Precious Metals Analyst at Casey Research, where he serves as editor of their Big Gold newsletter.

They tackle head-on many of the questions weary precious metals investors are wondering after enduing the volatile yet range-bound price action of gold and silver over the past year:

  • Have the fundamentals for owning gold & silver changed over the past year? No
  • What are they? currency devaluation/crisis, supply-chain risk, ore grade depletion
  • How should retail investors own gold? Mostly physical metal, some quality mining majors (avoid the indices), and ETFs only for trading
  • Is gold in a bubble? No
  • Could gold get re-monetized? Quite possibly
  • Where is gold flowing? From the West to the East. At some point, capital controls will be put in place