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Comsumer led Recession 100% chance, here is why ?
U.S. Must Buy Assets to Prevent "Tsunami"
Assume that the US assets are Commodities (CRB index), Stocks (SP500) and Real Estate (US Residential - US Census Bureau data).
A rough US based asset model would be all these assets adjusted for inflation (USA headline CPI), then there rate of change over 12 months added together to see how the overall combined assets prices are doing. You could allocate different weights to each class, but I have not.
Anyways here goes: The Asset Price Change (Inflation or Deflation of asset prices) 2008. Red shaded areas are USA recessions.
AssetPrices.jpg
1) 'Combined Assets Prices' sink in recessions, thus (of course) recessions are deflationary.
2) 2008 has yet to join the 'Combined Asset Price Deflation' club as commodities gains are holding combined price levels above ZERO. A full blown recession will change this, and we will get a real commodity price sell off.
Interesting...maybe Bart with his resources can do a similar study.
Comsumer led Recession 100% chance, here is why ?
U.S. Must Buy Assets to Prevent "Tsunami"
Assume that the US assets are Commodities (CRB index), Stocks (SP500) and Real Estate (US Residential - US Census Bureau data).
A rough US based asset model would be all these assets adjusted for inflation (USA headline CPI), then there rate of change over 12 months added together to see how the overall combined assets prices are doing. You could allocate different weights to each class, but I have not.
Anyways here goes: The Asset Price Change (Inflation or Deflation of asset prices) 2008. Red shaded areas are USA recessions.
AssetPrices.jpg
1) 'Combined Assets Prices' sink in recessions, thus (of course) recessions are deflationary.
2) 2008 has yet to join the 'Combined Asset Price Deflation' club as commodities gains are holding combined price levels above ZERO. A full blown recession will change this, and we will get a real commodity price sell off.
Interesting...maybe Bart with his resources can do a similar study.
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