Tuesday
Feb092010
ISM Commodities Survey Shows Increasing Inflation Pressure
Tuesday, February 9, 2010 at 03:36PM In each month's Report on Business, ISM publishes the results of its monthly commodities survey where it asks respondents which commodities are rising in price and which are declining. In this month's survey, respondents saw price increases in seventeen commodities, while no commodities saw a decline. As shown in the chart below, this month's level was the highest monthly reading since July 2008, and indicates that early signs of pricing pressure may be emerging. While concerns over inflation have generally taken a back seat to sovereign debt issues, investors would be wise not to discount them.
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Reader Comments (6)
This is exactly why it is good to invest in silver dollar coins and the like. As inflation heats up, the prices of hard assets increase while our paper dollars decrease in value. Yet, the government doesnt want you to know how high inflation really is.
To the "Silver Dollar Coins" Post: At first glance, I would say you are an anarchist. Then, after considering your your silly and uneducated attempt at a Fox News-type commentary, I would say that you're just a simple Glenn Beck fan, not taking the time to understand how or why certain asset classes function in different economic environments. The government wants to know about inflation more than we do, since we learned a tough lesson during the 70's - keeping rates low during a recession, where we are also experiencing high inflation, will increase the probability of high inflation. On second thought, I would say that you work for an organization like Goldine, except this organization is trying to buy and sell people's silver at a high profit. So, if you're reading this from your bunker, read a book and turn off the TV.
Post #2...WTF?
@TheRealist - You don't need to launch into an ad hominem attack, when you disagree with another poster's comments. There may be a conflict of interest, since it looks like your target is pushing a particular site. He may very well be pimping for the site he linked to. Your way of pointing that out is not the most productive.
I disagree that silver coin or junk silver investments are a good idea right now. There certainly is a question about conflicts of interest with the post. But I think there is a highly likelihood that the USG will try to monetize their reckless debt burden at some point in the future.
The government is doing this now
It has been going on for a long time---its just that people are starting to understand a wake up.
But, history has show us--just llike in Nazi Germany--people always wake up too late
Its already begun--in case no one has notcied
Comment #4 - Nice. You hit the nail on the head. The Realists' style is really more Glenn Beck than the first post.
Although I think that to a SMALL extent a diversified portfolio might need some precious metals exposure (as alternative investments), for the most part this guy is trying to run traffic to his site.
It's quite disconcerting to hear people saying that the government has already started printing money, mainly because there has been no visible sign of it in the budgetary reports. If they have, kudose to the government. The hardest part of getting away with inflating the currency base is not getting people to notice. And with rates as low as they are, it seems unlikely that the wonderful folks out there have noticed.
In responce to the last post, I don't think we need to worry about becoming pre-Nazi Germany. The variables are completely different. In pre-Nazi Germany, they were in a severe depression (along with the rest of the world) after losing the largest scale war of all time (at the time). What typifies wars of this scale are MASSIVE levels of public debt. But rather than default, the heads of the German government decided to print to pay. As Niall Fergusson points out, their debt level was so high that they experience over 1bn% (yes, 1,000,000,000,000%) inflation - the largest in history. Their debt to GNP levels were also to a point of EXTREME levels. So, although I think there is a distinct possibility that the Fed has started to slightly reer the printing presses, it is nowhere near the point of pre-Nazi Germany.