The ETF Report
Lawrence Sarsoun
321-259-4729
sarsoun@hotmail.com
Melbourne, Florida
Week of Jan. 31st. Deep Pockets. We have been trying to explain away the overabundance of cash in the coffers of major American companies. After all, first impression would be that this is the engine that will drive us higher and into the next Great Recovery. However, the fly in the ointment is that the next year or two will be fraught with hyperinflation par excellence. I remember the report I came across in the 70’s, “What would more inflation mean to you?”, by a think tank out of Great Barrington, N. H. The report told the story of the Great Hyperinflation after WWI, when, in order to cover their huge reparation losses imposed on them by the Allies, the Germans ran the printing presses day and night, until their currency was basically worthless. Talk about QE2!! The horror stories told how the wives of workers would come to their husband’s workplace with a wheelbarrow to cart away a load of currency to buy a loaf of bread.
Well, in my estimation, you ain’t seen nothing yet. Besides soaring materials costs, we can look forward to horrendous taxation. This double-whammy will clean out those deep pockets, and then some. Price changes will come so quickly it will make your head spin. Imagine a retailer like Wal-Mart trying to keep up with these rapid changes. Have you been watching the rising price of feeder cattle? Do you realize what this will mean to McDonald’s? And remember the wage and price controls of the early 70’s, when prices were controlled but things were unavailable? Earnings reports will come out like hammers daily driving down stock prices. Already the 30 year bond has inched up to over 4.6%. This will be the straw that breaks the markets back.
We are buying food, the inverse ETFs, water, silver (in small denominations)