Generational Dynamics Forum - New Site

• The beneficial effects of vaccines are much greater than
  anyone believed possible a year ago, or even a couple of months ago,
  because of operation warp speed.
• A large number of people have either been vaccinated or they've
  already had Covid, and so a lot people (the Neanderthals) are opening
  up businesses again and returning to work.
• As the weather warms in the spring, this trend will accelerate,
  and more people will be outside. (However, this trend could reverse
  in the summer if people gather indoors to enjoy air conditioning.)
  (This trend also won't apply to South Africa, South America or
  Australia, where it will be winter.)
• There was supposed to be a long, dark winter, but this morning's
  jobs report shows that the economy is booming. This is especially
  true of the leisure and hospitality sectors.
• After the Democrats' $1.9 trillion massive stimulus bill is
  passed, and $1,400 stimulus checks go out to everyone, then people
  will have a lot more money to spend, especially if they're going back
  to work.
• There is an enormous pent-up demand from consumers who have been
  unable to travel or go shopping, for a year.
• Therefore, there will be an explosion in retail sales, in travel
  and hospitality, and in other sectors.
• Therefore, there will be an explosion in economic growth in the
  last half of 2021.
• Therefore, there will be a rapid spike in inflation by the end of
  this year.
• In fact, I heard one "expert" go on a long rant this morning,
  saying that he has only one fear, inflation: "My greatest fear is that
  Jerome Powell is wrong about inflation, and that it will rear its ugly
  head, and once it starts to take off it will be like a momentum trade
  and keep growing faster and faster, and the Fed will be forced to
  raise interest rates as much as, God forbid, one percent, and that
  will hurt stock prices."

tim wrote: Fri Mar 05, 2021 8:31 am The Texas arctic weather disaster is a great example of the lack of foresight and inability of most people to look beyond the scope of their own experiences to be prepared for rare but not impossible events that history shows will occur at some point.

Apparently the last time Texas got that cold for that long was in the late 1890's and possibly the late 1940's.

So for your average Texan, who did not live to see such weather in Texas as they were not around to see the previous arctic weather events, the idea of subzero temperatures coming to their home and staying there for days was not something they were ever concerned about. Yet it happened as it happened before and will happen again.

Humans are unable to learn beyond the scope of their own personal lives and experiences, which is why the 80 year cycle is human nature.

From The Fourth Turning, page 317, How you Should Prepare:

Reflect on what happens when a terrible winter blizzard strikes. You hear the weather warning but probably fail to act on it. The sky darkens. Then the storm hits with full fury, and the air is a howling whiteness. One by one, your links to the machine age break down. Electricity flickers out, cutting off the TV. Batteries fade, cutting of the radio. Phones go dead. Roads become impassible, and cars get stuck. Food supplies dwindle. Day-to-day vestiges of modern civilization-bank machines, mutual funds, mass retailers, computers, satellites, airplanes, governments-all recede into irrelevance. The storm strips you bare, reducing your world to a small number of elemental forces-some bad, others good. On the bad side are the elements of nature. On the good are whatever scraps of social cohesion you can muster, from your own family's survival skills to neighbors who pitch in and share, to a family who lends you a truck-mounted plow because you once helped them out in a pinch.

Picture yourself and your loves ones in the midst of a howling blizzard that lasts for several years. Think about what you would need, who could help you, and why your fate might matter to anybody other then yourself. That is how to plan for a saecular winter.

Cool Breeze wrote: Fri Mar 05, 2021 1:21 pm It's a good lesson for sure. Howling blizzard for years? I think the best is to be able to manage half a year and then make movement plans, if possible.

John wrote: Fri Mar 05, 2021 11:31 am ** 05-Mar-2021 World View: The Conundrum of 2021 Economic Growth

There is a narrative among economists that conflicts a little with
what I would expect from Generational Dynamics theory, and so it will
be worth watching carefully to see how this tension between narrative
and theory plays out during the rest of 2021.

All the highly respected economic gurus that I seen on tv these days
seem to agree to the following narrative:

• The beneficial effects of vaccines are much greater than
  anyone believed possible a year ago, or even a couple of months ago,
  because of operation warp speed.
• A large number of people have either been vaccinated or they've
  already had Covid, and so a lot people (the Neanderthals) are opening
  up businesses again and returning to work.
• As the weather warms in the spring, this trend will accelerate,
  and more people will be outside. (However, this trend could reverse
  in the summer if people gather indoors to enjoy air conditioning.)
  (This trend also won't apply to South Africa, South America or
  Australia, where it will be winter.)
• There was supposed to be a long, dark winter, but this morning's
  jobs report shows that the economy is booming. This is especially
  true of the leisure and hospitality sectors.
• After the Democrats' $1.9 trillion massive stimulus bill is
  passed, and $1,400 stimulus checks go out to everyone, then people
  will have a lot more money to spend, especially if they're going back
  to work.
• There is an enormous pent-up demand from consumers who have been
  unable to travel or go shopping, for a year.
• Therefore, there will be an explosion in retail sales, in travel
  and hospitality, and in other sectors.
• Therefore, there will be an explosion in economic growth in the
  last half of 2021.
• Therefore, there will be a rapid spike in inflation by the end of
  this year.
• In fact, I heard one "expert" go on a long rant this morning,
  saying that he has only one fear, inflation: "My greatest fear is that
  Jerome Powell is wrong about inflation, and that it will rear its ugly
  head, and once it starts to take off it will be like a momentum trade
  and keep growing faster and faster, and the Fed will be forced to
  raise interest rates as much as, God forbid, one percent, and that
  will hurt stock prices."

So that's the mainstream narrative among the "experts." As I've
written many times, the "experts" have been consistently wrong since
2003, when I started keeping track. For the last 70 quarters, the
"experts" predicted that there would be inflation or super-inflation
in the following quarter, and for 70 quarters they've been wrong every
quarter. And now it's the same thing all over again.

It would be VERY nice if even one of these "experts" at least
acknowledged that they've been wrong for the last 70 quarters, and
explained why "this time it's different" this quarter. But they never
do.

I heard one person say, "I've always known when the economy is flooded
with money, then inflation will go up. That's what's going to happen
now." That's the knee-jerk view, but it's obviously not true. Since
2007, the economy has continually been flooded with money, but
inflation has not gone up. The person who said this is an idiot.

You know, I used to think that the amount of money in the economy at
least had some effect on the inflation rate, but as time has gone on,
I increasingly believe that the amount of money has absolutely nothing
to do with the inflation rate, at least in the American economy.

The inflation rate is not a monetary phenomenon. It's a generational
phenomenon. It's not the Fed that affects the inflation rate. It's
the people, the people's mood, that affect the inflation rate.

Since 2007 I've been talking about the velocity of money, which has
been plummeting, indicating no inflation, despite all the
money-printing. A falling velocity of money means that people aren't
spending money, so there's no inflation.

But let's try to explain this directly, without resorting to the
velocity of money.

Last year, the savings rate was the highest in history. That means
that people were not spending money. The "experts" are saying that
was caused by the pandemic, and this spring it will all reverse, and
people will start spending money explosively because of pent-up
demand.

In my opinion, any belief like that is crazy. Families that have
become accustomed to saving money for a rainy day are not suddenly
going to become profligate. Anyway, the savings rate has been growing
before the pandemic.

Furthermore, most of the stimulus checks are going to go towards
paying off debts -- credit card bills, loans, unpaid rent, and so
forth. Paying off debt is the same as saving, so for that reason
alone the savings rate will not significantly decrease.

In this generational Crisis era, the public mood is far different than
it was in the 1990s Unraveling era or the 1970s Awakening era. In
those days, the public mood was to expect full employment and
increasing salaries. The savings rate was low, especially for young
people, because there was no reason to save.

Today, millions of people went bankrupt or lost their homes duing the
2008 financial crisis, and they are still in shock from that
experience. And of course almost everyone is still in shock from the
pandemic lockdowns. To even suggest that there's going to be an
explosion in spending by young families who are in shock from the
pandemic and the 2008 financial crisis is ridiculous. They know
something that people didn't really know in the 1990s -- that
something new and catastrophic could happen again at any time, and
they'd better be financially prepared. That's why the public mood is
different during a generational Crisis era.

The assumption of an explosion in consumer spending is the lynchpin of
the conclusion of the narrative that there will be inflation or
superinflation by the end of the year.

That's the conundrum. It's going to be very interesting to watch for
the rest of the year to see which turns out to be right: The
mainstream narrative or Generational Dynamics theory. Of course I'll
be betting on the latter, since it's always been right in the past.

That's the knee-jerk view, but it's obviously not true. Since
2007, the economy has continually been flooded with money, but
inflation has not gone up. The person who said this is an idiot.

You know, I used to think that the amount of money in the economy at
least had some effect on the inflation rate, but as time has gone on,
I increasingly believe that the amount of money has absolutely nothing
to do with the inflation rate, at least in the American economy.

Observations

Velocity can rise if prices fall if the number of transactions goes up.
Velocity can rise if prices stay the same and M2 goes down.
Velocity can fall if prices rise if M2 goes up
Velocity can fall if prices rise and the number of transactions drops.

Key Points

Prices can rise, fall, or stay the same, no matter what velocity does.
Velocity does not determine prices.
Velocity does not determine or even influence anything at all.

Higgenbotham wrote: Fri Mar 05, 2021 1:32 pm

Cool Breeze wrote: Fri Mar 05, 2021 1:21 pm It's a good lesson for sure. Howling blizzard for years? I think the best is to be able to manage half a year and then make movement plans, if possible.

Interesting you say that. My plan has been to survive for a year, then take a look around and decide what to do from there.

Cool Breeze wrote: Fri Mar 05, 2021 1:44 pm

Higgenbotham wrote: Fri Mar 05, 2021 1:32 pm

Cool Breeze wrote: Fri Mar 05, 2021 1:21 pm It's a good lesson for sure. Howling blizzard for years? I think the best is to be able to manage half a year and then make movement plans, if possible.

Interesting you say that. My plan has been to survive for a year, then take a look around and decide what to do from there.

We're on the same page. Now if you just let that emotional baggage go, and you are right about the coming badness (though it won't be quite as bad as you think) you'll be thanking God for the guy you read on the internet that told you how valuable BTC really was and is.

I'll be taking in a drink with an umbrella in the sun in South America, and you know what, I'll buy you one too when you come down and we have all the fiat we desire to make local transactions because we have BTC as collateral, backing the stupid fiat that others take, because they didn't have the foresight to recognize the soundest money and network effect of all time.