Personally, I'm surprise at how robust are the global supply chains that have been able to keep things more or less normal despise what we have been through the last year.

The quantity of reserves created by the Central Banks are irrelevant if they are not spend in the economy. There are two effects to this "printing money": one is that the interest rate goes down facilitating borrowing from the private sector. The second is that governments have the ammunition to spend in stimulus. If the two things happen we could see inflation, but, notice that this the desired effect: compensate for a fall in the normal demand in the economy.

>" [..] central banks over the world have printed an astronomical amount of money. Even though they may state there is no significant inflation, I dont buy it [..]"

It seems to me that, in your model of the world, this should be leading to hyperinflation. If this is the case, my model of the world is wrong and I will make an effort to change it. I wish all the people has been predicting hyperinflation the last 30 years did the same if it doesn't happen. Somehow, I doubt it.

By now, the quantity theory of money based in the fractional reserve banking model should be discredited.

When the rest of the world begins using other systems than the reserve currency to conduct trade, the end result is that the inflation returns home as demand for your currency drops.

Anyway, the "reserve currency" excuse doesn't explain Japan in the last 20 years or the Euro in the last ten. The theory is just wrong. I don't know what more have to happen for people changing their minds.

It's spending what can generate inflation, specifically, spending above what the economy can produce. If Biden tomorrow created a trillion dollar coin and keep it under their bed, there will not be inflation. If the Central Banks create reserves, the interest rate will fall to zero (but not more), and if, despise the low interest rates, nobody is borrowing, there will not be inflation.

That's a failure of competition keeping prices in check, and little else.

The wealthy person you are looking for is Warren Mosler. He retired to the US Virgin Islands many years ago having made a fortune off the back of people who believed in the Quantity Theory of Money

You can read his conclusions in the book "Soft Currency Economics".

We have lots of things to worry about -- inflation isn't one of them.

I really hate this comment. I am worried about not being able to ever being afford a house for my family. Avg income in my neighborhood is ~49k but a 2 bed condo here are selling for 450K and getting outbid by 75k over the asking price. Its insane.

Maybe you already own a house and are happy that prices are up. But its really weird to tell other ppl what they should be worried about.

Sure, and your point about housing prices mattering is a good one (see my other comment on this story). But, this describes maybe a few dozen housing markets. Probably only a couple dozen if you cut out resort/ski towns. It's a regional problem, not systemic problem with the national economy.

It, uh, describes all of Canada actually.

https://www.reuters.com/article/us-canada-economy-housing-an...

Also, more Americans live in California than any other state. So if it’s an outlier, it’s an especially impactful one.

Its a national problem

https://www.redfin.com/us-housing-market

'few dozen' is what like 3 dozens? Assuming its a problem only in 36 markets. Wouldn't that be a 'national problem' ? 36 markets should covers a majority of population in the country.

E.g., in the Midwest you'd have to be in a nice part of Chicago or choosing the most expensive city neighborhood of a mid-sized city to find a meaningful number of $525K 2 bed condos. And even then, spending that much on a condo is 100% an unnecessary luxury. 10 minutes in any direction prices will crater, and by the time you get to the suburbs starter homes are from the $200s and $525K is a mansion. For the entirety of the midwest and most parts of the south.

Even on the coasts $525K for a 2 bed condo is a Big City thing. E.g., $500-$700K is the going rate for 2 bed condos in most of Boston, but drive an hour away from Boston in any direction? Not so much. Hell, even Wakefield has a 2 bed condo below $300K and that's only a 25 minute drive. And that's one of the more expensive housing markets in the US.

Living 20 minutes from major city centers via public transit has become a luxury, sure. But it's just not accurate to say that $525K for a 2 bed condo is "normal" in the US. It's not. It's quite specific to a very high CoL markets.

When I look at real estate in general in Chicago, it's been dropping a little, not a ton, but it's not like how other are describing the huge increase in housing costs in other parts of the country.

It seems like there are big regional differences going on with housing costs in the US. Supply/demand and policy I'm guessing are making the difference.

This attitude that the market must always go up has never worked out historically, just makes the eventual reckoning that much worse.

Fortunately that mentality means that renters like my wife and I who want our future kids to grow up in a good house in a quality school district can just keep saving money, waiting to capitalize on the inevitable normalization when all the speculators and eggs-in-one-basket people fail to learn from history... again.

Just inflating the bubble further, as every European bank and government is doing, to make existing property owners richer on paper and get their votes, is not a viable long term solution.

IMHO, it can't pop sooner. Houses should be for living, not for speculation and hoarding wealth. The younger generations have been screwed enough by the old established wealth hoarders.

Otherwise, the number of people in that "put their life savings as a downpayment on an overpriced house" category is only going to grow, making the problem worse when the collapse eventually happens.

I think we run into real problems in America trying to protect people from the consequences of their own bad decision making. In addition to being deeply patronising, it eliminates so many of the normal incentives to be responsible and pushes up risk appetite across the board.

If individuals make poor investments (whether on a house or gamestop otm call options) they'll learn their lesson and move on. There's enough of a safety net in America to ensure no one truly goes hungry from bad luck (and before you point to homelessness- that's a complicated issue intertwined with drug addiction, mental illness and in some cases a free lifestyle choice)

Prices are up for multiple reasons, including more pressure on shipping channels due to increased demand for goods across the board.

Also, this article is largely about inflation in developing nations like Indonesia. The inflation noted in countries like the United States is more pedestrian:

> In the U.S., prices rose close to 3% in the year ending Jan. 2, according to NielsenIQ, roughly double the overall rate of inflation.

The market is up 2% YTD, but down 4% from peak. It’s a reasonable time to buy (better than peak, at least).

If you must try to time the market, use time cost averaging to reduce volatility from getting a peak (or trough) price when you enter the market, but know that doing so reduces expected returns. The basic idea is to put 1/n of your money in over the next n weeks.

There are other things like real estate and government contacts, but those are less available to the casual investor, except through stock market funds.

https://www.cnbc.com/2021/03/08/how-the-young-plan-to-spend-...

It's possible something could set off the market today that accelerates the whole process, like the upcoming supplementary leverage ratio change. Or, the bubble could continue inflating until doesn't. But either way the whole thing is incredibly fragile and much more complicated than the "Stimulus is good for the economy" talk politicians are peddling.

John Hussman has a nice article on the option value of cash. https://www.hussmanfunds.com/comment/mc201201/

tldr: Suppose I offer you a security that will pay $100 two days from today. You can buy as much of it as you like today at $50, or you can wait until tomorrow. Tomorrow, I’ll flip a coin. If it’s heads, I’ll sell you the security at $99. If it’s tails, I’ll sell you the security at $25. What should you do?

Clearly, if you buy the security today, you’ll double your money two days from now. That’s a 100% expected return for each dollar you invest, over that 2-day period. If you wait, you’ll earn nothing on the first day, but you’ll then have two possibilities. If heads, you’ll get just 1% on your invested money. If tails, you’ll get a 300% return, quadrupling your money. With a 50/50 chance at each, your expected return for every dollar you invest is 0.51% + 0.5300% = 150.5%. So waiting adds 50.5% to your expected return over that 2-day period.