MARKET RAP MESSAGE BOARDS

  TJX Inc.
TJX
Amgen, Inc
AMGN
Citigroup, Inc.
C
  Hartford Financial Services
HIG
United States Steel Corporation
X
ADVFN
AFN.L
  Abbott Laboratories
ABT
PDL BioPharma, Inc.
PDLI
Forest Laboratories, Inc
FRX

Analyst Oversight

  Herb Greenberg

Herb Greenberg

Moderated By
Perry H. Rod

Giles David
  Michael Pachter

Michael Pachter

Moderated By
Perry H. Rod

Giles David
  Richard Gardner

Richard Gardner

Moderated By
Marty Rod

Giles David

Media Oversight

  Jim Cramer

Jim Cramer

Moderated By
Marty Rod

Giles David
  Michelle Quinn

Michelle Quinn

Moderated By
Marty Rod

Giles David
  Roddy Boyd

Roddy Boyd

Moderated By
Perry H. Rod

Giles David

Market Media Oversight

  George Soros

George Soros

Moderated By
Marty Rod

  Carl Icahn

Carl Icahn

Moderated By
Perry H. Rod

  Anatoly Chubais

Anatoly Chubais

Moderated By
Marty Rod

Market Rap Featured Analysis

 

Watch Out For the Real Inflation Rate of Seven Percent

by Perry H. Rod, Published: September 17th, 2014 8:02 PM CDT

Featured Analysis

Today, the United States Federal Reserve decided to continue its strategy of aggressive money printing, now in its sixth year after the market meltdown. The government today notes that inflation is low and under control. But here's the fundamental economic reality:

The value of cash has been going down by an average of about seven percent per year. Compounded over time, seven percent is a very large number.

Here's the analysis:

In 55 years, the total money supply rose roughly 39X; Gold rose roughly 37X; S&P rose roughly 36X; Oil rose roughly 33X


In 20 years, the total money supply rose roughly 3.5X; Gold rose roughly 3.5X; S&P rose roughly 4.5X; Oil rose roughly 6X

These numbers are relatively close and average out to around a seven percent compound annual increase in the price of gold, which mimics the growing overall money supply. But the S&P number does not account for dividend yields of around 2-3% in those time periods, meaning that the market has outperformed gold and taken a higher portion of the increasing money supply. That of course suggests the rich are getting richer, but you already knew that. Perhaps these outperforming companies are creating efficiencies over time that have lessened the costs of many basic goods and services for the middle class, creating a lower (and somewhat misleading) compound annual inflation number of about 3-4%. But the bottom line is not 3-4%, it's a 7% increase in the money supply (and gold).

So here's the deal: if your cash doesn't rise seven percent a year on average, you are actually losing value relative to the overall economy. That's the way it works, and it's pretty frightening to consider how few people are anywhere near that rate of return on their annual investments. It means that more cash is being concentrated in fewer hands, until (or unless) the government is forced to step in and reign in on the titans of wealth. No matter ...

MARKET RAP SELECTED ARTICLES

 

Watch Out For the Real Inflation Rate of Seven Percent
Today, the United States Federal Reserve decided to continue its strategy of aggressive money pri...

Perry H.Rod
 

Are Executives At Rockstar Getting Half The Profits At Take Two Interactive?
In 2008, after the successful launch of their hit title, Grand Theft Auto 4, Take-Two (TTWO) Inte...

Perry H.Rod
 

Las Vegas Underground House Remains on the Market for Ninth Month
In Las Vegas, TIX Corporation (TIXC) sells tickets for all kinds of places and events. But not fo...

MartyRod
 

New Top Income Tax Rates of 43.4% and 50.9%
2013 brings on a new top tax rate for those whose income is above $400,000.  Ordinary income...

Perry H.Rod

Market Rap's ALL TIME Top Stock Pickers

  Rank Return Last Action Trades Name Pic
 

1

834.1%

Buy`USL`@`38.83

10

Randy Hamdan

 

2

791.9%

Buy`UDN`@`28.5

33

Dan Toma

 

3

367.3%

Buy`AET`@`39.64

8

Dhananjayan J

 

4

290.8%

Buy`AAPL`@`202.31

117

Catarahia Dragos

 

5

196.8%

Buy`AAPL`@`205.94

1

Rob Kwok

Copyright 2014 All Rights Reserved; Patent Pending