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John Williams on hyperinflation

In case you missed this …

I usually take these things with a grain of salt. We’ve just seen a lovely example of how embarrassingly fallible predictions of doom can be. But John Williams of Shadowstats is the very definition of credibility, so it’s worth taking a new look at his most recently updated predictions for hyperinflation. In a word, he says: SOON. Within the year.

Here’s Silver’s take on Williams’ report. And Williams’ report in full.


Have you also noticed that we’re hearing the term “stagflation” again — meaning an economy that’s going nowhere while prices soar? Well, just a thought. “Stagflation” was something new when it reared its head in the 70s. Economists (presumably not of the Austrian variety) puzzled over it then, and now. What was that weird state and why was it upon us? Ah well. Before mainstreamers figured out the wherefores, Paul Volcker came along, gave the Fed a hard wrench, and that mysterious phenomenon of stagflation passed.

I don’t claim to be an expert. But there’s reason to think that “stagflation” is the larval stage of hyperinflation (sample + sample from very different parts of the political spectrum). Volcker may have wrenched us back from the brink all those years ago. Bernanke .. not likely.

Is Williams right? Dunno. I find it hard to work up the energy to go into Doom Mode, these days.

But if you had to bet on who had the best economic wisdom, who would you back? Williams? Or (pardon me while I spit tea all over the keyboard here) the Obama-Geithner-Bernanke team?


  1. Judy
    Judy May 26, 2011 2:08 pm

    Like you I’m not getting hysterical about the economic situation but I am keeping an eye on it. The Soros/Bilberger crowd that runs this country has yet to figure out that a health middle class puts more money in their pockets in the long run. So I keep gardening and use up, make do, or do without but do not incur any debt to the best of my ability!

  2. naturegirl
    naturegirl May 26, 2011 2:17 pm

    I cringe alot….and that’s because I’m one of the people trying to come back from a disaster that pretty much wiped out everything….puts us even more behind the proverbial 8 ball of things to come (or are happening)……

    I was thinking how all these recent weather destructions may actually put a few tens of thousands more to work and do a mini pump of certain related economies, but it’s not really gonna spark any kind of movement forwards (in general)…..

    Altho I do have to point out that when you’ve lost just about everything, if not everything, there’s a freedom that comes along with it…..and chances to make changes, if you can decide on what to do next……

    I did lol at the doom mode comment, cuz there’s only so much of that before you get numb after a while….

  3. DrillSgtK
    DrillSgtK May 27, 2011 7:01 am

    I feel that “doom mode” is just another form of being controlled by them. When you go into that mode they know how you will react and what they can do to direct you in the way they want.

    Taking a knowledge based approach lets you plan and control your life. Then you can direct your efforts into becoming just that much more free.

    One of my favorite pod casters likes to ask “did that dollar you spent make you more free or less?” Meaning did that dollar you spent on food keep you tied to the system or was it something that reduced your level of dependence on the system? If I spend a dollar on two cans of beans when I only need one, I have increased my ability to go with out the store or government aid that much longer. But if I buy two cans of beans and use two cans, i’m not becoming less dependent on the system.

  4. Claire
    Claire May 27, 2011 8:00 am

    Well said, DrillSgtK. You often have such great observations. Do you have an online home where you post thoughts like these? (I’m delighted to have them here, but just wondering where else they might be available.)

  5. Ron Johnson
    Ron Johnson May 28, 2011 4:54 am

    Slipping into ‘doom mode’ right now. Wife just lost her job. Can’t keep our current life going on my pay…and my pay is not all that secure, either. Time to simplify. Time to find other sources of income. Past time, as a matter of fact.

    I’ve been reading the doom-and-gloom economics stuff for decades. If you look at it from a long perspective, they’ve been dead-on. But their short-term predictions are iffy. Don’t know that I buy the ‘hyperinflation coming by 2012′ scenario, but certainly the long term trend, based on QE1-2-3 and the political environment, indicates that we are at least in for a long societal slide. That doesn’t mean everyone has to succumb to it, but it does mean I can’t expect life to go on as it was.

    Shakin’ off the blues…

  6. Desertrat
    Desertrat May 28, 2011 6:25 pm

    I believed Soros back in late 2005 or early 2006 when he predicted a recession to begin in the US in late 2006. Real estate had peaked in mid-2005. Before that, I was grumping, “Quo vadis?” about what had gone on in the dot-com bubble and then in the housing bubble. I had begun a leisurely prepping in the late 1980s.

    I began a repeat of the Carter-era term “stagflation” by late 2006 and have seen no reason to change. Nor have I seen any reason to disagree with Williams’ views, as they are parallelled by many of the “counter-culture” investors as well as people such as Schiff of Pimco.

    And now comes the UN, which apparently has been listening to the “Voice of Galt”:

  7. Desertrat
    Desertrat May 28, 2011 6:28 pm

    Addendum: Claire, I truly appreciate your cite of Debs’ “…two wings on the same bird of prey.” 🙂

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