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Ok, ok, asset price inflation measured by the S&P 500 has been about 9% annually from $123 in 1982 to $2,920 in 2019. In addition, the availability of debt amp
by drtillberg 7y ago
Ok, ok, asset price inflation measured by the S&P 500 has been about 9% annually from $123 in 1982 to $2,920 in 2019. In addition, the availability of debt amplifies increases. For example, the Case-Shiller Home Price Index increased from 100 to 220 between 2000 and 2019 (about 4% annually), but owners often leverage 80% at the start, and they actually have a 13% annual return (less carrying costs)-- lets say double the nominal return.
If high finance generated a ROI of 9% x 2 on average since 1982, through asset price gains magnified by leverage ... that would be 64% every 3 years, on average for almost 40 years. That's a remarkable inflationary event, however you choose to define 'hyperinflation.'
- lisper 7y agohttps://en.wikipedia.org/wiki/Hyperinflation https://en.wikipedia.org/wiki/Hyperinflation
- reallydude 7y agoExactly. It fits for the world-wide inflation. > In economics, hyperinflation is very high and typically accelerating inflation. > It quickly erodes the real value of the local currency, as the prices of all goods increase. This is in process. You seem to think there's a specific periodic minimum that is absolute. If the period is decades, it looks the same. > This causes people to minimize their holdings in that currency as they usually switch to more stable foreign currencies, often the US Dollar.[1] Prices typically remain stable in terms of other relatively stable currencies. Given this has affected every currency (not counting some closed off systems like NK) the flight currency is property/land/gold/etc
- lisper 7y ago> This is in process. Right. And Jesus is coming back any day now. Part of the definition of hyperinflation is that it happens fast. Price increases that take place over decades is not hyperinflation, it's just regular old inflation.