muses of the moment

January 11, 2014

John Williams with Shadowstats.com

John has released several notes on recent data. Here are some bullet summaries for free. He also released a Hyperinflation Update. He still calls for hyperinflation to begin in 2014. This conflicts with Martin’s thoughts on the dollar continuing to move up (or not decline) as capital flees the Euro and emerging markets.

– Extremely Difficult Circumstances in the Year Ahead: Confluence of Economic and Systemic Crises Should Intensify
-With Global Confidence in Dollar Rattled by Uncontrollable Fiscal and Monetary Excesses, U.S. Government and the Federal       Reserve Have Limited Options to Address Panics
– Heavy Selling of U.S. Dollar Remains Likely Proximal Trigger for Inflation Pick-Up
– Developing Hyperinflation Would Push Ongoing Recession into Deep Depression
– Physical Gold Remains Primary Hedge for Preserving Wealth and Assets

One thing to note. John’s definition of a hyperinflation is an increase in prices/expenses and a decrease in debt availability. There are other factors that can affect prices here in the US. Things that are produced here: US taxes, state taxes, rising health care costs. Things that are imported from emerging markets: rising manufacturing costs in China due to taxes, currency exchange rates, and labor demands. In reviewing gg’s utility cost breakdown for 2013, she noticed that the cost of energy/water was down or stable, but the taxes, admin, and service costs were up again. This has been a trend since she started tracking it. Infrastructure costs, labor costs, and taxes have a major impact on basic living costs. These things don’t have anything to do with the dollar chart. groovygirls says: if your basic living expenses go up 2-3% per year, but your wages are flat or go down, it feels like an inflationary depression to you, personally. Martin’s thoughts on the dollar are invaluable to those able to trade the globe, not just the US economy.

– Jobs Loss or Jobs Gain, Either Is Possible Within the Reporting-Confidence Interval Around December Payrolls
– Revisions Show Headline Unemployment Changes Are Meaningless
December Unemployment: 6.7% (U.3), 13.1% (U.6), 23.3% (ShadowStats)
– Year-to-Year Growth Slows in December M3

– Plunge in Oil Imports Narrowed the Trade Deficit; Data Were Positive for Fourth-Quarter GDP
– November Construction Gain Was Statistically Insignificant, Yet, Earlier Numbers Were Revised Higher
– Revised Headline Unemployment Due on January 10th

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