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The underlying problems that caused the recession have not been corrected. Uncle Sam is charging up a storm on his credit cards at an unsustainable pace. The US dollar will continue to erode. When the day of reckoning comes (and it will) what will happen to stock prices? Will they escalate in value because it will take more (devalued) dollars to buy stock, or will the stock prices suffer like housing prices have? HELP!

What do you see happening if Iran or North Korea lob a weapon into some other country in their region of the world? Shouldn’t we have some insurance for that event? Oil? Gold? What would happen to the U.S. stock market? Other markets?

Thanks

The Dow is about to head south in earnest… Gold is getting
ready to head south big time…oil is about as high as it will
get for a long time…Ind’ Metals are ready for a long trip
south, in fact you will see commodities in general at for
lower prices before this DIPRESSION is over !!! Sure
there will be ongoing corrections, nothing goes straight
up or down !!! I see from your blogs that the herd is out
in force going full blast up hill… I’ve seen that many times
in my 81 years… You remember our ‘ole’ buddy Joe
Granville, he said when they scream “gimme the bag
give em the bag !!!
Good Luck & God Bless

My greatest concern is that so many banks have been weakened by the housing bust of 2007 and 2008, personal savings rates continue to climb, unemployment continues to rise and we are on the verge of seeing another mortgage crisis of the same proportions as the last with the reset of the adjustable ARMs and the AltA’s. We have seen over 100 banks fail already and many more banks are in serious trouble. I don’t find this in many publication and wonder if it is being ignored or overlooked. I don’t see the present financial crisis being over until late 2012 and the going sideways for a number of years after that.

I keep asking for the process of investing who do I talk to? I figure maybe someone will contact me.

If oil taxes hugely increase, does that affect the profit on an investment in oil?

I have been checking my emails regularly about Dr. Weiss’ investment
specialist from Germany, who was going to be investing in the next few
months from March of this year, with Dr. Weiss’ $1M, and was curious how that project has come about? have not heard or read anything for some time now. Is it still going on, or has it been completed?

You are likely tired of my comments this week as I commented at length a few days ago. My only addition now is concerning Agricultural Commodities and stocks which I believe may well rise fast as the world realises that food supplies are limited.

Regards, Graham Chrystie.

There are thousands of acres of oil land under petroleum lease in the USA. But nobody is drilling. Why? Because the once encouraging 27 1/2% depletion allowance at the well head exclusion from taxes is a thing of the past. There is still lots of oil in the USA but it is now taxed by the IRS and most of the states except California and that wont last. Drilling wildcats, or even offsets to known production horizons is expensive and risky. Why be punished for taking a risk? If they ever bring back the depletion allowance hold you hats. The lease hounds, Schlumerger crews and geologists will be back in a big way.
Need oil? We got it!

Ithink that by the end of 2010 the dow will end up around 1200 and the best profit oppertunities will be in commodidies, and energy.

2010 will be a roller coaster for investors. After the current mini-bull market runs its course by mid 2010, volitility will reign while we watch the fed try to start mopping up excess liquidity towards mid/end of 2010. After this immpressive run in Commodities through end of 2009, they should level off until world’s banks and investors seek safe havens from the ravages of inflation begginnning to poke it’s nose under the tent towards end of next year.

Dear Martin

Market will remain volatile but at the same level. Oil may be bit higher so Gold will be higher due to weakening $ and more and more country will diversify from other vehicle than $ as loosing ability of $ strength.

May be treasury will go down due to lack of buying by other sovereign govt. to support treasury auction.

I believer the Dow Jones will reach about 1075 by years end in February -March it will decline and eventually drop back to 550 and remain below 900 for the remainder of 2010. Oil will hold between $80-95.00 and not exceed $120 due to political forces. Gold will not exceed $1400 /oz. Many of our kids will be on Food Stamps by the end of 2010.

I believe we will see the Dow at 15000 in 2010, but early 2011 will bring in a sharp downturn. Oil is headed above $100/bl in 2010 and even higher in 2011, possibly $200/bl. Gold will hit $2000/oz in the next two years. In fact, most all natural resources will at least double in value by 2012.

I will be very interested in the results of your survey and at the actual close of 2009 and 2010 as I am very unsettled by the government debt and the continued devaluation of the US $. There just is not a historical event that has any where near this level of US government intervention into the stock market or privite/public companies and such government “managed” business such as Freedymac and Fanniemax. I am 67 and I thought that my youngest grand kids would be involved in the decline of the US life style but now I think I will see that in the next 3 to 5 years.

The S&P will be at 624 on 12/31/2010
Oil will be at $22.50
The Dollar will be at 95
Bank failures will be rampant.
The federal reserve will be in question of it’s solvency.
Housing will be down 72% from it’s peek
Gold will be at $685

Larry Vaughn

I see the Dow dropping to about 6,000 by the end of 2,010 because unemployment will continue to rise and consumer confidence will continue to drop, which will finally confince Wall Street that the recovery it thought was here is no where in sight. The place to be is in oil and gold.

The VIX will remay high and we will have many vallys and highs till the end of next year at which time I think we’ll start a slow move up, it might come after next years elections, or the start of the new year.

I think that most important factor for the economy is the employment level. It will moderatly decrease in 2010.
Second most important, is personal savings which will increase significantly in 2010, close to 10%.
Consumer spendings will be maintained at 2009 level.
Consumer oriented companies will suffer and weaker companies will bankrupt resulting in more vacancies for the commercial real estate companies. They will not be able to meet their mortgage obligations and more commercial banks and state banks will banrupt.
Low consumer spending also mean that manufacturing industries will suffer, import will diminish, transport industry wiil continue to suffer.
Once personnal savings reach 10% in 2011, the economy will start moving upward, new investment will be made, new products will be manufactured, new companies will be created, employment will rise.
Confidence will be restored, dollar will be stonger.
One wish, no more government intervention, no more «to big to fall», no more monopoly money.
Louis Chatel

Commodities will be king over the next 24-48 months while we resort the economic order of the planet. I believe the BRIC countries will assume lead role with China, then India leading the way.
If we pass Tax and Cap, we’re dead meat because we are likely the only net payor into the system. This is just another way to achieve the “new world order” desired by some to bring the US down to the level of the EU countries that are suffering the pains of socialism.

1. Obama/Pelosi/Reid will drive the deficit and entitlements into the stratosphere on partisan Health Care and Cap & Tax decisions.
2. GDP growth of 1-2% in Q4 and Q1 with unemployment of 9.5-10.5%. Negative GDP growth for Q2-3 and slow recovery in Q4.
3. The Dow will test its March 2009 low and recover somewhat after the Nov. 2010 election.
4. Bernanke will keep printing money and the 10year Treasury rate will exceed 5% in late 2010 or early 2011.

I feel we should be returning to the Gold Standard. I think USA has been foolish to make the US$ a reserve currency and allowing its trading partners to invest in Treasury Bills and paying them interest. History should have told them that the British Empire’s Reserve Currency GBP was also downgraded when America agreed to FUND world wars and became a large creditor, a role now being taken over by China and shortly India.
It should matter little or nothing if Gold climbs up to $5000/oz. because as an International Trading Reserve Product, each Surplus Country will be able to store WITHOUT INTEREST so no Deficit Country will pay interest on its shortfall but rather only on its borrowings if any. The Politicians will be required to manage their budgets in accordance with their NEEDS rather than their WANTS and pay interest to lenders accordingly from earnings generated.

Here’s a forecast. One thing I try to remember but usually forget is that just becasue something is inevitable does not mean it is eminent so here goes. The dow is expected to go down to about 8860 prior to the end of the year. Am looking for the Dow to then go up to about 11,000 by April/May/Jun and then - I look for inflation to start by the middle of 2010 - interest rates to “start” up and the inflation is expected to be reflected in “stock prices and the Dow to get up to about 14000 by years end. Oil and gold to also reflect the inflationary prices and to hit 200 and 2400 respectively. Hows that for a piece of fiction? Like the way you write Larry

I think Hunker down…. stocks will tank again with another round of banking debacles as people and businesses default…. So if you can pay off debt, own a piece of land, learn how to grow vegetables. Hold gold, silver and underlying stocks. Believe Chinese stocks will do well but not sure I want to invest over there because of underlying human rights issues.

The US$ will stablise,at what point? When the Euro and the Rinbin(Yuan)exert enough pressure for a new world currency, If they could agree on which would it be;? Europe would insist on the Euro,China on the Yuan,=compromise (China would not lose face) so,I t would have to be something Tangible,stable,accepeted world wide and not subject to the vagaries of the markets.
My suggestion is a standard volume of a precious metal,silver,gold,Platinum,to which all world currencies would relate to,or have in theircurrency,sort of physdo gold standard.

IF WE ARE NOT CONCERNED, WE MUST BE ASLEEP RIP. I DON’T HAVE CONFIDENCE IN OUR “SAVIORS” OR THEIR COMPETENCE TO COMBAT/COMPETE WITH THE INTERNATIONAL POWER BROKERS. INTERNALLY WE ARE SUBJECT TO MANIPULATIONS THAT ARE APPARENT IN THIS DAY AND AGE OF ELECTRONIC DATA DISCLOSURES. THE NUMBERS ARE MIND BOGGLING THE MAJORITY OF THE POPULACE WHO HAVE NO REAL AVENUES OF SAFETY FOR THE FUTURE.

TEXAS WORRY W…

I believe that the DOW will continue to expand, but that the economy will be very slow to improve and it will be late 2010 or early 2011 before the employement will begin to turn upward.
I will look at more investment in commodities and select investments in China. I am presently invested in energy, gold, gold mining and financials, but I will continue to keep a cash reserve.

With our countrys debt increasing each day to staggering levels, and personal debt at max levels, WHERE is the money going to come from to bring this country out of this recession? It ISN’T!! Most of those who are still working are playing it safe with their money because they could be next to get the axe. Some people are slowing getting back into the market, but they are like cats on a hot tin roof, they will jump off at the slightest fear. The market will not be above 1200 by the end of 2010.
I am surprised that Israel has not bombed Iran’s Nuclear sites yet, as 2010 draws near, I am certain that Israel has plans to do so, but are waiting for global diplomacy to have it’s chance. That time will run out soon.
Oil prices should slowly rise towards $100 a barrel, but if/when Israel bombs Iran, WATCH OUT! This country is quietly advancing towards oil independence knowing full well that any outbreak of hostilities with Iran will raise hell and havoc with oil prices on the world market.
The value of the dollar will sink more then stabilize, as all world currencies struggle against recession. Gold will rise more above todays level, but will not be able to sustain level above $2000 an ounce.
World weather will cause more problems than we have seen in a long time, as sun spot activity is at its lowest in recorded history, and this will cause more havoc than global warming.

Financial mess will not be resolved for years as the root cause is the housing debacle.
There is a simple, easily implimented solution which is non inflationary, would substantially reduce the number of reposessions, allow the government to make a profit, and would require the banks to improve their balance sheets yet still take responsibility for their loose lending practices … I share my plan and welcome your critic:
• All homes that are presently in default or about to go into default should have their respective mortgage agreements renegotiated if they qualify for the new lower payments. If they do not then the house should be reposed and put up for immediate sale
• The government should take over as the prime lender, offering to refinance on a demand note basis @ 5%. (Interest only no principle)
• Government issues 10 year treasury notes (3.5%) to cover these loans and offers the home owner the homeowner the opportunity to stay in the house paying just interest. (Government profit 1.5% per month)
• Result is the homeowner should be able to reduce his payment by ~ $2,000 per month for a 30 year $360,000.00 mortgage.
• Government could even add up to $10,000.00 to pay off a credit card balance for qualified home owners. (+$31.25 per month) If their DSR is in line.
• Any homeowner that defaults on these “interest only payments” goes into immediate repossession… No exception
• Government sells the house back to the existing bank for the amount originally owing and the bank puts the house up for immediate sale, and takes the loss. (In the case of default … Bank still owns the risk)
• Homeowners have 10 years to repurchase their homes through traditional lending practices (i.e. Financial Institutional Mortgages) Normal inflation / currency devaluation should have these homes back into an equity position well before the 10 years is up.
• Government buys back the treasury notes whenever a home loan is repaid insuring no increase in government debt.
• In addition, to remove the glut of homes currently on the market, the government holds a limited lottery for non residence who purchase (mortgage free) a home to be granted citizenship … (example) First million homes purchased by qualified buyers ( Subject to Home Land Security pre screening) gets full citizenship with all the benefits that current citizens receive

Benefits

1. No additional government debt with a guaranteed profit.
2. Non inflationary (money taken out of the system when the house is repaid)
3. Immediate removal of the over supply of homes thus increasing prices which will stimulate the construction industry.
4. An additional 1,000,000 tax paying citizens with financial means.
5. Americans get to keep their homes plus have the added advantage of increasing their disposal income with the reduction of credit card fees and reduced house payments.
6. With normal inflation, it is expected that the home values will increase over the next 10 years where the home owners will be in an equity position and be able to refinance through conventional means.
7. Immediate stimulus to the economy with the additional credit card leverage.
8. Banks will have an immediate increase in Capital and their Balance Sheet / Liabilities should be greatly improved with the increased affordability to the homeowner. Stronger balance sheets will lead to an immediate increase in lending which will free up the capital markets and release the economy from the current deflationary pressure.
9. Similar relieve will be immediate in the credit default swap market.
10. Calm will reach world financial markets without inflationary pressures, without government ownership. The banks will incur the losses they deserve for their irresponsibility, but not to the degree they potentially would have, and the American homeowners will be able to keep their homes.

gold up to almost 1100 today…will be up to 1200 by 1/1/10

I believe Obama’s reckless venture into green will never solve our dependence on foreign resources in a 100+ years. He has his own agenda. The best interest of the American people may not be part of Obama’s plans. He is self serving and his actions indicate bigger government and more control of our freedom. The free-market system is in great danger. His actions may make this country less safe.
With the wasted TARP MONEY we could be well on our way to solving our energy problems, that was cause by the special interest groups. We must explore every avenue of our vast natural resources. No State must be excluded. Every resource must be utlized. We have the technology to do it safely.

Dear Martin,
Congratulations for your work and your politics and institutional efforts.
I’m also from Brazil. I say that because I was born here, while you are a true Brazilian in your heart.
I am a teacher at the Pontifical Catholic University of São Paulo in the area of political economy. I research the business cycle as well as geopolitics.
Dawn I describe how I see the economic scenarios and the geopolitical one.
Economic scenarios

The cycles have an average of about 6 to 7 years. In my mark for the cycles of the postwar economic world leader, the United States, the latest crisis begun in early 2007. Therefore, the next start will be necessarily within a window that begins in early 2013 and will be closed in early 2014. That goes for the U.S. economy and also for the world economy since there is strong synchrony between national economies in the globalized economy.
Worth a lot for business in general has mastery of the theory of business cycles and their occurrences, their history. This is, in my opinion, the most important tool for forecasting and make scenarios. The cycles are endogenous and are based on the material structure of production.
The next crisis is likely to occur after a recovery very weak or even nonexistent. In this sense I have two scenarios: a) crisis in 2013 to inaugurate a depression b) crisis in 2013 already in a depression in progress. It depends on what happens in the coming days, if we have the beginning of a depression for that matter in late 2009 and early 2010, or the begin of a minimal recovery.
The Dow Jones, it’s all makeup. There are nothing in the fundamentals of the U.S. economy to justify the performance of the stock market. On the other hand, is palpable the bursting of the fantastic bubble that now underpins the stock price of companies and banks. The P/E is on stratospheric layer. Everything will collapse soon. There are no way out for the deficit monetization. Apparently this will happen within a major disaster of the U.S. Dollar. Well, that makes up the fundamentals of the scenario of a depression that can start now. If the U.S. economy collapses, the world will follow - there is no escape out this dynamic.

Geopolitical

For the world as a whole, we are in the later stages of the BIG GAME. At this stage the new global polarization has already happened and ends its latest bindings. India and Japan are the undecided “voters”, but they are in advanced stages of binding. The two poles are headed: a) the United States on one hand, the “old Europe” of another. Russia, China and Brazil have engaged the “old Europe”. In Latin America as a whole we see today the development of the clash between Brazil, as upward force, and the United States, as downforce. The capital of power and management in Latin America, including black Africa, is Sao Paulo - megalopolis that you know very well. The stakes in the Brazilian economy are the best, despite the very gloomy scenario that we see for the world economy.

A big hug
Jason Borba
Please: excuses for my very poor English

Not too ago, I heard something to the effect that makeup of our genetic structure, while inherited from our parents, undergoes changes during each individual’s lifetime. In other words, we are also the product of various genetic changes that occur over generations, which have been the result of various environmental influences (nature vs. nurture).

It occurs to me then, that at this particular juncture, the “Jackass Dumb” gene may now be predominating the American bio-physio-psychological make up. (Anything approaching an objective view of the behavior of our political leaders should make this more then abundantly clear).

Perhaps this phenomenon is not such an anomaly when taken in the historical context of “Empires” just prior to their collapse. For instance, I believe that scientists have theorized that the fall of the Roman Empire was due, at least in part, to a type of dementia that gradually overtook the population (especially the ruling classes) as the result of imbibing wine from mercury laden chalices.

Whatever the causative factors, one can hardly avoid the fact that the telltale signs of some such similar phenomenon are now everywhere about us ……. right here in the good old USA.

Solution: If at all possible, get your ass out of the U.S.!

Joseph kahl— 11.4.2009. America has always been the economic power house and fore runner in many areas in the world. The depreciating or falling DOLLAR value will give U.S. exports a boost, and improve overall U.S. manufacturing, which should create DOMESTIC demand for locally produced U.S. goods, against higher external imports into the U.S, and possibly improve job security and employment. External countries currencies valuations will either have to appreciate or depreciate relative to the U.S. dollar, in order to make their exports attractive to the U.S. consumer, and remain competitive. Any robust or rebounding economy can digest gradual higher interest rates and some degree of rising inflation. Trade imbalances should be minimized and contained e.g. China exports to the U.S. Debt obligations and Credit balloons when export and import trade imbalances exists,e.g. China’s percentage ratio exports into the U.S. Notably,China’s export feeding frenzy of and towards the U.S. domestic market, has tremendously escalated its earnings Surplus position, and more so as a result of an under valued Yuan. Invade any consumer oriented economy with cheaper exports, extensive low domestic interest rates time frames, can enslave any country citizenry, and make it a consumer oriented glutton society, with abundant and inherent National debt from external lenders having favored trade exchange leverage.
But then again, trade imbalances, volatility of one kind or another in the commercial world of free markets exchanges and activities, keeps free enterprise alive. This submission is not cast in stone, and conveys my personal assessment.

Dear Martin,

Here are my predictions asof 1/1/10;

DJIA 1100
NASDAQ 2,100
S&P 500 1,100
Russell 2000 600
10-Yr T Note 3.85%
Gold $1,150
Crude Oil $85.00
USD 75

It’s possible Obama will luck out, anything can happen. otherwise we are in for a rough time.

Hate to sound like a humbug, but we are not in a capitalist system anymore - it is now corporatist. That is not semantics. Global corporations, especially Banks and related entities, aided by modern technologies, are no longer subject to oversight by government or its institutions, in fact the reverse is true. They have wealth, power and an international jurisdiction that governments can only dream about. In many cases they have bought governments and their institutions, including the courts and regulators. They truly believe they can do a better job at running things than entity to date.

There is not conspiracy in the strictest sense, so readily dismissed by most sober- minded people. Take for example the over-used term “New World Order”. Then compare the US and EU definitions or versions, and their relative aspirations in that regard - it is a little troublesome. In prediction of the future, we are now longer safe using any of the classic models. The reason is that there truly is an elite (G-20, IMF, World Bank, BIS, etc) who do get together - not in conspiracy - but to create consensus on “next steps”. Without a glass to the outside wall, and your ear to the glass, who knows what that consensus will be over time. But we can be sure that with control of supra-global institutions capable of transferring information or implementing decisions in nano-seconds, you are now betting against the house….in a similar way to going to a casino.

It is not free-market capitalism that we are trying to assess, but global corporations controlled by an elite, not always in agreement. And we have no personal access to these people and their close minions. We cannot read the signs through the media - it is a distorting lense. I have guessed, for fun. But I put aside all professional medels and theories applying to capitalism in doing so.

What we have seen in the past three decades was not capitalism, and it is important to know the difference, without becoming too paraniod. It was a foretaste of things to come. We are in a whole new game, and few seem to realize it. We have to wakr up to keep that game honest because they can now make up the rules as they go along. It’s not the end of the world, but the beginning of a new era. We just have to clue in and perhaps be a little more pro-active in keeping them from loading the dice - because the old ways of holding them in chek are passe.

Dear Martin.

I entered your forecast contest last night. I understood that I would get an E-Mail according me the selection of a 3 month subscription to my choice of newsletters but
as yet no such notification has appeared in in inbox. Is it supposed to happen right away or do we wait to the end of the year?

Hope to hear your answer soon.

Cecile

Sadly, I see another 1929 ahead. I’m 94 now and I dread to think of the young people who will be saddled by our enormous debt.

You need to save your financial self, as the government is printing wildly. Buy gold and oil!

Martin, I still believe your original analysis of the situation is correct. I think we are seeing some incredible similarities to The Great Depression, and the next big drop in the stock market is just around the corner. I think those who are predicting a correction in gold and silver are going to be waiting a long time. Silver is probably the best deal out there is you want to protect your money, because I think it’s very undervalued compared to gold. Both will be much higher by the end of 2010. I’m afraid unemployment will get much worse, so consumer spending will continue to fall. Due to this we will have a real problem trying to get the economy going again. The bailouts, and reckless government spending have assured the dollar will buy less and less, so I expect inflation and higher interest rates will compound the problem sooner than the deflationists expect. The new administration has compounded our oil problem at precisely the wrong time, and this will haunt us for a long time. As you say, I’m sure smart investors will make a lot of money, the rest will lose even more than they did in the first leg of this bear market.

Keep up the great work, and thanks for your excellent advice!

Jon

I expect oil price to continue to rise above $110 a bbl in 2010. I expect
inflation to increase and PMs to rise in price. The Dow and s@p should also rise.
Would that be a crack up boom?

I am concerned in the impact the dollar drop in value will have on Real Estate in the US.

Any comments on playing N. Gas through UNG?

Natural gas can replace diesel at 1/2 the cost and is 90% cleaner. We also have a distribution system set up throughout most of the country.

Bills are in the congress to give tax credits to conert “large vehicles” to NGAS. Walmart and other are already doing this.

NGAS has traded at 1/8th the price of oil, historically.

With regard to healthcare and energy —- Unless the corruption is brought under control — most of the good ideas mentioned will never be done. Sad but true. We haven’t had anything close to a free market since Reagan. we must get gov’t spending cut massivly. Lower taxes and give the private sector incentives to build businesses and create jobs. Oil and gold are also under the influence of the banksters. The Fed keeps printing moola! Unemployment keeps going up. I hope that real concern for the country overides special interests. Unless priorities change, the U.S. Dollar will continue to weaken going into 2010. Believe me, I really hope I’m wrong for the sake of our country. Am I wrong?????

I’m concerned about the housing market. Hopefully the supply will diminish in the coming years and resolve mcuh of the problem.

Market is a place where no body is wrong every body is Mr right.All p&m failed when Gold reach $1100.Spend as much as your pocket permit

The current situation on Wall Street has nothing to back it up except the U.S. government with U.S. currency which is worth less and less each day. Gold is overpriced and oil for energy is being consumed internationally. My thoughts go to clean drinking water and water purification as being the next resources that will hit the radar.

In reference to bank bailouts - why don’t they call the $8000 first home credit what it really is? That credit is not generating any kind new employment (except for the IRS auditors) or new construction. It is really another bank bailout with a different name.
How can anyone guess how our economy is going to be anytime in the future when the government keeps “shooting from the hip”!

To Whom It May Concern,

Rather than make predictions - my approach to the new year will be watching it closely. A couple of the items I will be watching will be capacity utilization and unrmployment. Additionally, using an exponentially weighted moving average (from WINKS Statistical software - professional edition) to detect early on changes in the latest CPI - U and London Gold Fix prices. The CPI - U signals changes in inflation and would cause me to seriously consider buying some more gold. To track changes in the CPI - U is like doing the arithmetic to calculate compound interest in a bank account - except that the “interest varies.” A graduate student, studying economics at Columbia University (in New York City) showed me how to do this The price of gold is one way of taking the pulse of which way inflation is moving as well.

Sincerely,
Robert

P.S. I do not think that I ever would buy gold mining stocks because gold mines can be nationalized. Additionally, I would never carry gold on my person but rather keep it in a safe at a friends or relatives house - and not in my house.

I think that monetary inflation is occurring but only spotty goods inflation.
With the layoffs there will not be more money chasing few goods but less money chasing the same number of goods. The govt can print all it wants but if it is not in the hands of the consumer it will do no good.
Most of the printed money may be going into the black hole of debt.
If business don’t lower prices they won’t survive.
I think that the greater trend is to one worker per family just as before WW2 and before we had the only intact factories in the world - we don’t now.
This is deflation not inflation.

Ever see the movie “Wall Street,” starring Michael Douglas? If so, I have a stock for you. It’s called Gold Reserve, Inc. (GRZ), which was at one point Larry Edelson’s # 1 gold stock. West Face Capital, Inc., a large Canadian hedge fund, has started aggressively acquiring Gold Reserve’s stock. In less than one month, West Face has purchased over 14% of Gold Reserve’s stock. As they said in the movie, “Gold Reserve is in play.”

You’re right. This is deflation, especially when one throws in the demographic trends.The recent good news regarding GDP won’t be enough to ignite a recovery that would spark inflation. That’s why monetary policy will remain loose.

Cut up your creditcards. Pay down your mortgage as quickly as possible. And if you have any savings left buy gold.