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2021-07-13 07:00 by Karl Denninger
in Federal Government , 220 references Ignore this thread
It's Just Fear, They Say...
[Comments enabled]

Uh huh.... inflation fears?

Americans' inflation fears reached a fever pitch in June, rising to the highest level since June 2013 as the price of consumer goods continued to surge, according to a Federal Reserve Bank of New York survey published Monday.

The median expectation is that the inflation rate will be up 4.8% one year from now, a new high for the gauge, and up 3.6% three years from now, the highest level since August 2013, according to the New York Federal Reserve's Survey of Consumer Expectations. 

People always understate inflation -- and their expectations always are less than reality.

How's the price of food doing for this last year?  Gasoline?

Food and energy aren't important, right?  How about health care?

But... remember, Americans also support the government spending more and more money.

Money they don't have, and thus don't tax first.

What causes inflation?

Spending money you don't have.

So why is it, may I ask, that "expectations" as so high?

Maybe you ought to get up and have a look in the mirror; after all, you let the infestation of both state and federal governments go on with all their "unemployment" benefits and literal trillions of spending that was not funded by taxes.

Yeah, I know, there was a pandemic.

That's nice.

Did it require us to put a gun in our economy's mouth and blow its brains out?

No.

You did that, not a virus -- both with Trump and now Biden.

Congratulations.

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Cmoledor
Posts: 144
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Akron Ohio
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Yup

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The whole world is one big ****ing scam
Why are you giving a vulgarity warning here? Our genial host is an advocate of both skull****ing and sodomy via rusty chainsaw. Credit to Rollformer
Augeries
Posts: 201
Incept: 2019-09-26

North of Boston, but not North enough.
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So I've got a question for all of you who are smarter than me: I am in a position as a new homeowner where my house is almost entirely up to date on required repairs. Septic, siding, windows, everything is new and good to go for a while, except the roof. The roof probably has another 2-4 years left on it. However, the way things are going I am considering getting it replaced early (metal, I'll never have to touch it again) because I'm worried about astronomical price hikes and my savings dropping in value.

I have the option of pulling some mutual funds to do this. How risky is it to have that money in the market? I'd like to do as I was taught and "forget about that money until you retire" but it just seems riskier and riskier, especially since I'd be spending on a legitimate need.

Thanks for any advice.

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I'm Team Virus. It Deserves to Win.

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Greenacr
Posts: 291
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Northern Ohio
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Just payed my 2nd half (rent) Property taxes on my house..... no inflation there..... oh wait.......****.
Silverspur
Posts: 8
Incept: 2021-06-19

Pahrump Nevada
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I have a degree in Health sciences, early in my career I worked in Public Health, as my career took its twists and turns ended up working in education, law enforcement, regulatory enforcement among many other tasks. When the 'pandemic' started I watched as Public health protocols were thrown by the wayside. Basic procedures such as don't speculate (2 million will die) give the public only factual information so they can make their personal health decisions based on
the best actual information, don't politicize as that can lead to social unrest(AIDS quickly became political). I watched as infected individuals were placed in Nursing homes (insane! poorly trained nursing home staffs expected to deal with infectious disease patients). The most basic protocol in disease spread, slow population movement (flights from China) criticized. Same people saying 2 million will die, hospital flooded in six weeks, came out against a possible treatment Hydroxychloroquine then Ivermection (remember 2 million may die) Then we learned of risk factors that seemed effect those who died Diabetes,obesity, ignored. Where were the public health officials who should have pounded these lifestyle choices contributing to mortality using their soapbox? I watched as Law enforcement measures were used by politicians instead of the most basic premise of Law enforcement which is always 'voluntary compliance' thru education not force. In my career I was trained in concept called 'totality of circumstance' Look at the entire picture. It became clearer and clearer there were motives behind all these actions, instead of basic public health protocols. Think back,Fauci standing behind Trump day after day, knowing damn well more about the Wuhan lab, and their GOF research. I watched as family and friends fell into this mass hysteria and developed basically a psychosis losing touch with reality and not using any critical thinking skills we all possess. So we have a mess folks, a population whose psyche is so damaged most will never recover from it. Brainwashed. So that is what we are dealing with. We have a old buffoon now in the WH, who the public should demand a complete physical, including drug testing and a comprehensive cognitive exam, won't happen. So all the other issues inflation, red flags throughout the economy are ignored, remember the vast majority of the population is mentally damaged at this time. As KD has says time and time again, it well may be over.....
Handyone55
Posts: 287
Incept: 2010-07-06

Ceciltucky, Maryland
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@Surgeries - I cannot give you any investing advice, but, steel roofs work very well. I am trying to get my house in good shape for the economic problems I see inbound. Better to get repairs done while parts are available.

I had a 20 plus year old shingle roof that was starting to leak. I had a trusted local contractor install a steel roof, new gutters, gutter guards, and downspouts. Price for a 1200 square foot house was $8000 for everything.

The contractor screwed 1 by 4 strips to the roof and mounted the steel on top. No tear off needed and the job took 2 workers 2.5 days. The roll forming mill miscut a piece, which cost half a day delay. I did not have ice tabs installed and wish that I had. My wife freaked when a huge sheet of ice thundered down on our deck. No damage but noisy.

The contractor said something interesting. He said steel roofs now cost about the same as shingle due to high labor costs. Steel is more expensive per square foot but installs fast. This may be area specific? Good luck with your project.
Twainfan2
Posts: 305
Incept: 2018-12-04

MN
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With the changes made to M1 and M2, it's tougher to get a long term read on them. M2 is now only useful since May/june 2020 due to the changes. If my math is right, M2 is up about 12% since the May 2020 changes. I generally assume that's the bare minimum of real inflation. It was going up about 6% annually as I believe Karl pointed out long ago.

Still hoping the lid blows off this mess before the 2022 midterms so the sheeple get covered in the **** they voted for.
Superdude
Posts: 444
Incept: 2009-06-16

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@Augeries
Shop for the roof now. See if you can get a good deal. (I doubt it with prices in lumber but they are dropping a bit) If you find something good take it. If not wait. Not sure if you live in an area that is prone to heavy snow. If you do live in an area with heavy snow get the roof sooner then later. Nothing like a collapsed roof in winter. If in the south, you could roll the dice and hope for hail damage. If this is investment property to be flipped/sold soon, skip the roof. Sell as is on it. Demand is too much to give in on seller side. If this is where you hang your hat up, peace of mind is worth it.
Riceday
Posts: 766
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Augeries - Speaking of inflation - Roof prices I have seen - New construction standing seam metal is 5x the price of asphalt. Regular screw down metal roof is 3x. The problem with regular screw-down is not the roof material, it's the exposed washers and screws which are of varied origin that deteriorate. This is what I was recently told by a builder. Not only are the prices insane, the quality is just unknown. That seems to apply to many things manufactured in the last year - appliances, equipment, etc.
Susanlauren
Posts: 345
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@Augeries. I don't think any of us have a crystal ball. You are asking between two questions. Metal roof or mutual fund and are ignoring other possible options such as paying down the mortgage on your house, buying prep supplies such as food, barter items and other such stuff, investment in silver or gold, and I could go on. With respect to your mutual fund savings, if you are earning 2 percent and the inflation rate is 5 percent, you are losing 3 percent of your money every single year. That can't be a good deal. I hope that helps.
Crossthread
Posts: 9393
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Surf City/Sloop point, NC
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Riceday says..
Quote:
it's the exposed washers and screws which are of varied origin that deteriorate.


We have a Winna!!!

The home I'm "renting" has a metal, (screwed down) roof.. Screws are "galvanized",, Buuuut,, the washers under them are deteriorating= leaky ceilings..

Thats on My immediate *to Do* list..

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Quote:
I've no more ****s to Give, because, It was a republic if you could keep it at all, We lost, RIP #Merica

HOLD MY BEER! [beer]
Where's Kyle Rittenhouse when U need Him?
Indianarube
Posts: 89
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@Augeries. Is the money you have in the mutual funds in a retirement account? If so, I wouldn't touch it. I would probably wait until fall or next spring to do the roof, just to see how all the coming nonsense plays out.
Whitehat
Posts: 5498
Incept: 2017-06-27

Elsewhere
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Cross -- if you have to fix the roof yourself on a house that you are renting, you are in the wrong house.

@Augeries -- regardless of the financial implications, a failing system or structure is a massive liability. Always fix it properly long before failure. If things did go to **** or if somehow prices on labor and materials went down, can you guarantee that you will be in the same stable situation now or that some other crisis will not be concurrent when you "must" get it done. Apply this to all critical systems in life. The roof is that, pretty basic. Pedestrian example is a working class person skimping on something that is going to break or maintenance on his necessary work vehicle or only car. It almost always happens that a crisis is occurring right as the deferred maintenance causes a failure. This at minimum is an opportunity cost.

Can be the same way with a house. Let's say that the roof gets bad and starts to fail right as something goes wrong in your life or, something that i am seeing a lot, your insurance company says replace it within six months as it is a liability to them. Note that once this happens in an area, all insurance companies get in on the fun. Let's say that you must move quickly and it costs you 75K USD or more in equity. All of the above and the last is a definite hard example of costs that far exceed the loss of some investment value or penalty for liquidating said.

Always avoid being forced to do something.

As for the metal roof stuff. I dunno your climate and market, but think of it this way. How many more yeas are you going to live? Most GAF composite shingle roofs are long warranted and are known to last with the proper underlayment and installation. Why make something immortal if you are not? if the world or country goes to some **** where one is worried about never getting common roofing materials ever again or getting repair work done, one has bigger problems and might want to be dead anyway.

I dealt with this with high value clients and their executive redoubts. They wanted everything at such a high level and skimped on what really mattered. Unless one is building a family redoubt with the intention of generations living there or wanting to or if even possible, this permanency thing is merely a denial of death at the subconscious level.

Do a thirty or forty year roof and have money set aside to nail down another layer when you are retired if necessary. I'll freely admit mistake here. Finished my retirement house at a much higher level of quality than the market could return to me at this point or that people would notice. Yes, not much will ever have to be done, however could have achieved about the same result without the sting of being slightly below breaking even when leaving. Every house around me where things were done cheap but looks acceptable goes for the same money.

sometimes it is better to treat real estate as transient and somewhat disposable depending upon the area. A lot can happen over the lifetime of a standard roof.

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smiley

"Better to reign in Hell, than serve in Heaven," Satan's monologue in the first book of John Milton's Paradise Lost
Heartlander
Posts: 474
Incept: 2021-02-25

Kansas
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I really appreciate @Augeries' question, and all the replies, especially @Susanlauren's. My retirement funds are all in the bank, and I am well aware that that's insane. But if the end of the world as we know it is coming soon, do I really want to invest in the stock market? Umm, no thanks. Gold? The government could pull an FDR. Land? The government could pull a Stalin.

So I guess home repairs make as much sense as anything, especially since I own my house free and clear. Just do everything now that I even think there's a possibility of eventually needing? Basically compress the hypothetical maintenance schedule from a few years down into the next few months? Lot of guesswork there, and potentially a lot of unnecessary expenditure. But I might as well withdraw and spend most of my savings, I suppose, since I'm 90% convinced that all that money I now have in the bank will either be inaccessible or only worth pennies on the dollar in the near future. (Can you say Weimar Germany?)

If ammo weren't so darn expensive, I'd take most of my savings out of the bank and just spend it on ammo, which is possibly the best barter item there is. And if survive the coming ****storm long enough to even HAVE a retirement, maybe later I could sell the ammo for cash to live on or barter it for food in my remaining years?
Crossthread
Posts: 9393
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Surf City/Sloop point, NC
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@Whitehat,, It keeps My rent **LOW**, so theres that.. I do alot of DIY around here, (LL supplies stuff I ask for), To keep up "Maintance" of this place..
1200.00 is a STEAL around here for a 3 bdrm.. (where I reside..)

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Quote:
I've no more ****s to Give, because, It was a republic if you could keep it at all, We lost, RIP #Merica

HOLD MY BEER! [beer]
Where's Kyle Rittenhouse when U need Him?
Seektruth
Posts: 1100
Incept: 2007-09-01
A True American Patriot!
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Regarding retirement funds...I'm at the point I don't think where you put it matters much considering where we're headed. Therefore, if you want/need to spend some of it then go for it. I have no debt and save a ridiculous portion of my wages, but I mostly haven't/don't put it into 'risky' investments so I've missed out on a lot of paper gains. It used to bother me but not so much any more.

I've been doing a lot of home maintenance over the past couple years myself...roof, hvac, etc. Next up is new kitchen appliances (really mixed feelings on that one...I'm expecting **** for quality). Thinking about acquiring more tools that may come in handy. Steel/brass/lead are covered. Adding some more long term food storage here and there. Anything I can think of that I might need and won't go bad in storage, I'm considering.

I'd like to sell my nearly new truck and make about 9k on it after buying it last year, but wtf am I going to do with the money? Don't need it right now, that's for sure. Might as well keep the truck and enjoy having a nice ride that's useful for my purposes.

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Enjoy your stay in Clown World!
Augeries
Posts: 201
Incept: 2019-09-26

North of Boston, but not North enough.
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Thabks for the advice everybody. I think I'm going to start getting some quotes together. The last thing I need is an issue popping up during the middle of another crisis, as Whitehat said.

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I'm Team Virus. It Deserves to Win.

The World is Quiet Here
Jacksparrow
Posts: 108
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Olympia WA 98506
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We let it happen? Uh Trump was no saint, but likely better than Biden. Do we even have honest elections in this country?? Uh no we don't. We basically have a uniparty regime. Sure, we could all refuse to engage in commerce, and in some areas I have. But with everything electronic monitored by the deep state, and the FBI going after those darn white supremacists just how long until these democratic storm troopers end up on your front lawn? Blame away, but the only real way to confront this is for solid conservatives to run for every office out there and try to oust the fake conservatives. It's slowly starting. CRT and the forced vaccines are getting peoples attention.
Peterm99
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Augeries wrote..
The roof probably has another 2-4 years left on it.
Be careful with this type of thinking! This presumes a level of objective predictability that doesn't exist in this case.

When one considers the variability in quality of original materials and construction, the type and severity of weather experienced during its lifetime, and weather still to come (among many other factors), it is, IMO, extremely dangerous to play such a game. When approaching the "expected end-of-life" of something as critical as a roof whose condition is extremely difficult to evaluate in an objectively quantifiable manner, it is probably more appropriate to think of 2-4 years as a one sigma value on the originally expected lifetime than as a remaining lifetime you can count on.

Add in the uncertainties NOT related to your current roof (e.g., future material availability, economic conditions, etc.), I believe that getting it replaced very soon rather than waiting another couple of years is the prudent course.

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". . . the Constitution has died, the economy welters in irreversible decline, we have perpetual war, all power lies in the hands of the executive, the police are supreme, and a surveillance beyond Orwells imaginings falls into place." - Fred Reed
Tickerguy
Posts: 175429
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Oh please @Jacksparrow.

Quit sucking off politicians in public. Do that **** in the privacy of your own bedroom if you insist.

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Tickerguy
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@Peterm99 - It's actually not very hard to objectively look at a roof and get a handle on things. Look for the granular material still on the shingles and, in particular, look for the fiberglass starting to show through around the edges and the asphalt wear so that edge banding is visible.

That, once you see it and the granular material is approaching exhaustion, is approaching the "wear limit" on the roofing material assuming it is not leaking now (e.g. the seal formed by the shingles, which "glue" together when it first gets good and hot, is still solid.)

IMHO when you reach that point you are not losing much by replacing it. You might get another 3-4 years out of it, but you also might not.

BTW the alleged "warranties" are basically worthless once you get past 10 years or so. Read 'em sometime.

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I don't give a flying **** if you're offended.

Jack_crabb
Posts: 11625
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Peoples' Republik of Maryland
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Quote:
However, the way things are going I am considering getting it replaced early (metal, I'll never have to touch it again) because I'm worried about astronomical price hikes and my savings dropping in value.


Steel prices have increased 250% in the last few months. I am a commercial roofer and I put a standing seam roof on my last house only because it was not all that expensive for me to do it.

I would never put a standing seam (zero exposed fasteners) or an ag panel (exposed neoprene-washered fasteners) on a house of mine. Riceday's comments are in line with my experience.

"Lifetime" architectural shingles are beautiful and are warranted for 50 years. Personally, I wouldn't even think of standing seam unless 1) you are married to the look and 2) you have money to throw at it.

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Molon Labe
Where is Henry Bowman when you need him?
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Crossthread
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I've been in & seen *Tobacca* barns built in the Early 1900's,, in N.C. ( & late 1800's) ) with "metal roofs" or shingled..

Still standing strong.. What has changed? Besides the heartwood Pine they were built with?

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Quote:
I've no more ****s to Give, because, It was a republic if you could keep it at all, We lost, RIP #Merica

HOLD MY BEER! [beer]
Where's Kyle Rittenhouse when U need Him?
Peterm99
Posts: 8457
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@Augeries -

If you are leaning towards a metal roof, I would suggest that you check out aluminum "shakes" in addition to the more standard, conventional metal roofs.

~20 years ago, I replaced my old cedar shake roof with aluminum "shakes" and couldn't have been happier. It is basically just aluminum sheeting formed and textured to look like wood shakes with a baked on finish (available in lots of colors). The sheets are configured sort of like asphalt roofing "tiles", i.e., each sheet has the form factor of three adjacent thick cedar shakes. They are designed to interlock (and, of course, to overlap a little) and each "sheet" is separately nailed onto the roof underlayer just like normal shingles/shakes. From a distance of >5 feet, it was impossible to tell that it wasn't a real cedar shake roof. I lived there for a dozen or more years after installation and had zero issues - no integrity problems, no fading of the color, etc. When I sold the house, the realtor prominently noted the aluminum roof as a high value selling point.

Have no idea of today's cost, but, just for comparison from 20 years ago, on my ~2K sf house in So Cal, an asphalt tile roof would have cost me ~12K, a new cedar shake roof 15K, my aluminum roof actually cost me nearly 18K, and concrete or clay tile would have been 20K+ (costs are soup-to-nuts all-in - permits, prep, materials, installation, clean-up, taxes, etc.).

The only downsides I'm aware of are two: 1.) I was told that rain falling on the roof is a little louder than with wooden or asphalt roofs, so I elected to have the thickest available felt/tarpaper/whatever installed between the plywood underlayer and the aluminum and, quite frankly, after the first couple of rainstorms I never even noticed the noise, and, 2.). I was told that very severe hail had been known to slightly "dimple" the aluminum but that it would only be visible under very close inspection and that it posed no integrity issues. There were several severe hailstorms while I lived there but I noticed no "dimpling of any kind.

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". . . the Constitution has died, the economy welters in irreversible decline, we have perpetual war, all power lies in the hands of the executive, the police are supreme, and a surveillance beyond Orwells imaginings falls into place." - Fred Reed
Susanlauren
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Maybe I am saner than sane or maybe I am madder than mad. But I am viewing cash in hand as a liability. I am on a spending spree. I figure I will hold my own financially just by having goods rather than cash. So that jar of pickles went from $1.59 to &1.79. I just gained about 12 percent in appreciation. That pound of bacon that I froze in the freezer was $3.99 per pound. Now it is $4.79 per pound. I bought chicken thighs on sale for $.99 per pound. These are now $1.49 per pound. I couldn't do as well if I invested in the stock market and these are tangible items that have practical survival value and use. I already have toilet paper; I figure that as long as paper dollars can be traded for something of value, I best trade them for something of value. No sense in using dollar as TP. I have prepaid taxes and utilities and paid for an entire series of items because once the banks and internet shut down, the value of these accounts will be zilch. I will soon be ordering another two cords of fire wood and with what I already have, I am set for heating into next spring. The propane tank is filled. And so it goes. I am not sure when it goes from slow collapse to sudden collapse, but I want to be well prepared in advance.
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