STARTED HEARING WARNINGS ABOUT DEFLATION MONTHS, IF NOT SEVERAL YEARS, AGO. The mega-deflation of oil and the junk bonds got the ball rolling and certainly seemed harbingers of more to come.
This RBS release is not really news, but certainly bears repeating. All markets are extremely dangerous and volatile right now, and may continue for some time to come. Not time to make big ticket purchases or investments unless it's in cash instruments. I myself don't like the sounds of words like cataclysmic. Highlights of this rather ominous piece today in The Telegraph:
RBS cries 'sell everything' as deflationary crisis nears. Clients told to seek safety of Bunds and Treasuries. 'This is about return of capital, not return on capital. In a crowded hall, exit doors are small.' RBS has advised clients to brace for a “cataclysmic year” and a global deflationary crisis, warning that major stock markets could fall by a fifth and oil may plummet to $16 a barrel.I don't think we've ever lived through a real, honest deflationary period in my lifetime. Sure, we know inflation. But, here we may be heading toward uncharted territory.