It is fascinating time today – The day of “cash is trash” is finally here.
THANK YOU MR. RAY DALIO!
Cash is indeed becoming trash these days – literally the cost of everything is going up.
For those products or services with limited supply but increasing demand? You can bet the hyperinflation is here and probably not going anywhere.
I own a condo in new york and my building actually has parking garage inside the building.
Now I don’t live there, but I heard something interesting.
“Did anyone get the email that parking garage monthly fee is going up by 10% next year? It has been flat for the past three years and they are saying they are raising the fee because cost went up”
UNREAL – 10% increase puts us in hyperinflation territory. AND this increase was not demand driven, BUT COST DRIVEN.
THE UPWARD PRESSURE IN COSTS IS PUSHING THE PRICES HIGHER!
If you think about primary cost of running a parking garage, it probably is heavily driven by labor costs.
LABOR COSTS ARE VERY STICKY and they are definitely not transitory as in they are not going back down.
Once you pay someone $30/hour because you had labor shortage, you can’t go back down to $25/hour- that person already has elevated expectations for higher wages next year.
This is a strong signal for hyperinflation in America – REMEMBER – American economy us heavily dependent on services industry i.e. labor is the biggest input costs.
With cost-driven inflation and that cost is primarily a function of labor, it is pretty easy ti think that hyperinflation is coming.
AND THE FED IS DENYING UNTIL THEY HAVE TO FOLD AND HAVE TO RAISE RATES
WHAT AM I GOING TO DO?
I AM SELLING STOCK
I AM BUYING REAL ASSETS
Like GOLD COIN
Like Rolex
Like Tesla
Every product where there is supply / demand imbalance – because these products lose minimal value/functionality over time, but enjoys stable or increasing demand
Get ready for hyperinflation!
