I have been saying this for two years, but we have both .
Clothes and electronics are in a deflationary spiral.
Stocks (especially emerging markets), real estate, oil, chemicals, food, travel and entertainment are in an inflationary spiral. One look at the long-term charts of gold and the US dollar show you what’s happening. MONEY PRINTING.
It’s not complicated over the long-term. If you print something a bazillion times, whether it’s a dollar bill or a Van Gogh lithograph (but not a Lindzon blog post), it will lose value.
I could discuss all the other reasons, but it’s boring because there is only one…our leadership – corporate and political. The best, original series of blog posts on our decay come from Bubble Generation on the ‘MACROPOCALYSE’. Read them all !
One look at the stock market shows you the trouble we are in. There is so much money chasing growth that the multiples on global growers has gotten insane. I have lot’s of new money to put to work, but it is in the same choices as last year to put them to work in. Since I do have a bit of a brain, that is not so appealing to me. This is a much easier time for a machine than a human.
It is also the main reason my stock picks have done so well this year. I have focused on the fastest growing companies and left financials alone.
All good things end and all strategies go out of favor. Mine has been in. That won’t last forever. If I could say exactly when, I promise I would tell you, but I can’t. The people who can work for CNBC and The Times :) …NOT.