Weekly Update 10.13.17

Adam Taggart
By Adam Taggart on Sat, Oct 14, 2017 - 12:45am

9 Comments

Uncletommy's picture
Uncletommy
Status: Gold Member (Offline)
Joined: May 3 2014
Posts: 426
History repeating again?

Roman Emperor, Tiberius ran into the same problem watching asset values increase with no increase in utilitarian value. He set the template for Beranke, et. al. by issuing fiat currencies to the major banks to keep them solvent.

https://www.globalfinancialdata.com/gfdblog/?p=1374

The decrees which had precipitated the problem were suspended. 100 million sesterces were to be taken from the imperial treasury and distributed among reliable bankers, to be loaned to the neediest debtors.

And, what was the resulting outcome? (spoiler alert)

When Tiberius died in 37 AD, he had a fortune of 2.7 billion sesterces, or over $50 billion.

Hallelujah; the banks were saved again, the provinces revolted due to excessive taxation and the general population was forced to eat Hamburger Helper without the hamburger; yum!

Rector's picture
Rector
Status: Gold Member (Offline)
Joined: Feb 7 2010
Posts: 482
The Frustrating Thing. . .

about this is that it is almost IMPOSSIBLE to explain this to bleary eyed sheep who don't have the interest, curiosity, nor education to understand what exactly is going on.  We will just have to keep telling each other the same stuff while we watch the whole show collapse.  <<sigh>>

Rector

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1411
Re: History Repeating Again?

This is the best book I have read on politicians repeating the same mistake over and over: https://www.amazon.com/Fiat-Money-Inflation-France-Brought/dp/145157164X/

KugsCheese's picture
KugsCheese
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Posts: 1411
Car Quality 1997 vs 2007

I would argue the average 1997 car had higher quality interior: ubiquitous soft touch materials vs ubiquitous hard plastic that scratches easily.

Rodster's picture
Rodster
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Posts: 11
A Saying I Learned Many Years Ago !

"It just goes to show how figures lie and liars figure".

Barnbuilder's picture
Barnbuilder
Status: Bronze Member (Offline)
Joined: May 7 2014
Posts: 50
Practical real world example

I needed a square u bolt type clamp to go around a 4"X 4" and a 2" piece of pvc.  I knew I had bought a couple years ago that I never  used but I could not find them.  Found them at a big box store for nine dollars and change and thought it was crazy. Came back home and started digging and eventually found the the two clamps I had bought between 1996 and 1999.  Price sticker was still on them like new. Price then? 0.89 cents each. Figure that rate of inflation with no possible hedonic changes.  Same story for 3/4" brass ball valves, unions or any other fittings. I guess bankers and government statisticians find it easy to believe the low inflation myth.  If you deal on a daily basis with basic items not subject to a hedonic adjustment you know the real story on inflation.  Unfortunately my income has not had the same rate of change. Oh well, we'll survive whatever comes.  It sure is hard to enlighten other people about what is happening to them and their standard of living and what comes next.

 

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1411
Re: Practical Real World Example

The 1997 bolt was probably made in USA and will last a lifetime while the modern bolt is made in China and will fail in 2-5 years.

aggrivated's picture
aggrivated
Status: Platinum Member (Offline)
Joined: Sep 22 2010
Posts: 523
Cars, tv's and gizmotronics

Chris,

Great expose on the fantasy CPI numbers! As a buyer I couldn't care less about a car that lights up as I approach, or a TV that watches me, or a $1,000 dryer that can steam my shirt wrinkles. What I do care about is the HR dept that sets the parameters for salary increases and the bureaucrats that determine social security raises and a Congress that thinks exercising its patriotic duty means stimlating the economy with deficit spending.

Abolishing the CPI would do more to bring about a reality check than any other single act I can think of.

DPriz's picture
DPriz
Status: Member (Offline)
Joined: Jan 12 2016
Posts: 5
How Soon We Forget

2000

2007-2009

Dow at 23000 today and most everyone thinks this is normal.

My sociology professors would be proud that I had identified COLLECTIVE BEHAVIOR by the masses sooner than later. I put this under the category of FAD and CRAZES.

DISASTER BEHAVIOR by the masses will soon follow.

Hope my patience pays off. Its been dificult staying on the sidelines.

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