One of the most dangerous set-ups with investing is when you find yourself not questioning your beliefs. By accepting as fact your current predictions about the future, you leave yourself vulnerable to that which you can’t conceive. No mind can adequately factor in all outcomes with investing.
This week we look at the validity of the idea that Hyperinflation / Dollar Debasement is a foregone conclusion. Legions of neo-monetarists proclaim with supreme confidence that the actions of the Federal Reserve MUST lead to Hyperinflation. Yet, that chorus is four years old today, and no truer now than when the Fed began pumping the monetary base. The term Hyperinflation is used incorrectly by many, and too often in general. Very few people can tell you how it Hyperinflation can be avoided, as if there is no way—a silly contention.
Again, this money manager is not saying that there is NO way high- or hyper-inflation is possible—just that folks need to re-evaluate the premise and consider what they might be missing, which seems like quite a lot. A more balanced look at the risks and probability of Hyperinflation is in order, and we can’t have an intelligent dialogue about it until then.