re: Assuming hyperinflation is coming....

would mortgaged real estate be a good investment?

if inflation really kicks off the asset should inflate but since it's mortgaged, the loan is set in stone

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seems it also does not look at anything that isn't getting massively deflated by technology

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this is the key, the increasing technological advancements are highly deflationary which is incompatible with our inflationary system

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No - the federal government says COLA is only 1.3 % and there is NO inflation

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Federal Government also tells me election fraud doesn't exist

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would mortgaged real estate be a good investment?

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If you believe that inflation will run higher than 2-3% you can make an argument that a fixed rate mortgage at market rates is equity on your books. The regulator is going to be punishing lenders for what could be decades.

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Argentina's inflation woes stretch back decades. In the mid-1970s, Argentina's inflation rate shot up and averaged 300 percent per year for the next 15 years. In 1989, the inflation rate in Argentina hit a whopping 3,079 percent.

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Most wages in Argentina had set increases based on the inflation index. It was in part its own feed back loop.

Read an article that looked at how people coped with that kind of inflation. When they got paid, they immediately bought anything tangible that could be used in barter or sold later to preserve some real value. I guess stocks and viable real estate fits the bill.

That was before total Democrat takeover of our federal government and the second stimulus. Also I'm clearly saying that it's very inflated, but this is a discussion about hyperinflation which is now a very real reality. I've argued for years that were artificially propping up the cost of these assets for the short term, only to have all that money printed creating inflation that will destroy our economy. My hope was at our monetary policy would allow for a reset and more reasonable prices, but now it's a very likely extreme scenario staring us in the face.

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That was before total Democrat takeover of our federal government and the second stimulus. Also I'm clearly saying that it's very inflated, but this is a discussion about hyperinflation which is now a very real reality. I've argued for years that were artificially propping up the cost of these assets for the short term, only to have all that money printed creating inflation that will destroy our economy. My hope was at our monetary policy would allow for a reset and more reasonable prices, but now it's a very likely extreme scenario staring us in the face.

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Though I disagree with it personally (insofar as you are referring to price inflation generally and not just asset price inflation), this is a valid view, but for what’s in bold. “Hyperinflation” as a term is as overused as “money printing.” The fact is the U.S. has never experienced hyperinflation, and likely never will. The generally accepted definition of “hyperinflation” is a 50%+ month-over-month inflation rate, which equals a year-over-year inflation rate of ((1.50 ^ 12) - 1) = 12,875%.

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The generally accepted definition of “hyperinflation” is a 50%+ month-over-month inflation rate, which equals a year-over-year inflation rate of ((1.50 ^ 12) - 1) = 12,875%.

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well as discussed in this thread, we're not talking about REAL hyperinflation...but it won't take that to make RE investing +EV, per a couple people in this thread.

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Maybe I'm missing something though, I know there's smarter economists than me on this board, didn't know what pce was until a page or 2 ago but after reading about it...it seems it also does not look at anything that isn't getting massively deflated by technology and excludes desirable scarce assets while being a little less cherry picker like than cpi. Cpi seems absolutely ridiculous to me, it would only work if all technology advances come to a complete halt.

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CPI and PCE are each imperfect. There’s no doubt about that. But if you’re claiming there’s this persistent hidden inflation that is somehow higher than nominal GDP growth, what you’re really saying is that the U.S. economy is declining in real terms. Think about it - nominal GDP is effectively an index of expenditures on newly created goods and services across an entire economy. If the inflation rate you claim is higher than the nominal price change in GDP, the entire U.S economy is in a state of persistent contraction. If that’s your view, it would be an extreme one. This is why it makes sense to use the GDP deflator as another arrow in your inflation quiver - it’s a great sanity check.

You are right that CPI and the like don’t incorporate asset price inflation into their calculations, but that’s not what they are attempting to measure. The average Joe isn’t lamenting how hard it is to get by due to the rapid increase in Apple’s stock price. This is why economists tend to differentiate between asset price inflation and inflation in consumer goods and services.

I tend to agree the Fed’s policies have been a significant contributor to massive asset price inflation. More discerning Feds than our previous few have viewed untethered asset price inflation as something that can become highly problematic. In the 1920s, some Fed members were intentionally trying to pop the bubble, for fear of what it might lead to down the road. There were those in the late 90s of similar mind. This particular Fed seems to be less concerned with asset bubbles than they are with the economic turmoil that would take place if real interest rates rose in an overly indebted economy. That puts them in the unfortunate position of being both the cause of the problem (artificially low rates leading to structurally unsustainable debt) and what they view as the solution (keep interest rates low to artificially sustain structurally unsustainable debt).

In the words of Frédéric Bastiat, the Powell Fed is apparently only concerned with the “immediate effects” of their actions, no different than the politicians they are supposed to be independent of:

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In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause - it is seen. The others unfold in succession - they are not seen: it is well for us, if they are foreseen. Between a good and a bad economist this constitutes the whole difference - the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee. Now this difference is enormous, for it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal, and the converse. Hence it follows that the bad economist pursues a small present good, which will be followed by a great evil to come, while the true economist pursues a great good to come, - at the risk of a small present evil.

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