For all those bulls that are endlessly bullish all the time (not anyone in here, I mean on TV and on the blogs), the cold, hard facts tell another story, as I've mentioned many times before. Look at a chart of the Zimbabwe stock exchange when it was the #1 performing market in the world, all the while it was experiencing hyperinflation that made $100 trillion dollar notes about $3.50 on eBay. Look at that link I posted when Israel had its hyperinflation, and its stock market zoomed.

Yeah, zoomed in nominal terms. I can't buy goods 'nominally'. I can only buy them in 'real' terms. Take a look at the Dow in closer to 'real' terms in this article, using gold. I have also seen a real-world, for the middle class, inflation index, and the Dow in those terms, and the results are similar.

Think of it this way. Imagine you buy a basket of stocks at the 2009 low. Pretty good job, eh? Let's say that basket can be sold and will buy you a basket of goods composed of food, gasoline, electricity, health insurance, and things you and I actually use daily. Let's say you can buy 100 units of this basket. Now the stock market rises and rises and rises on endless FED QE.

Now the Dow is at 100,000, the ES at 10,000, and the perma-bulls are ecstatic. Non-stop bullishness on TV. Talk of how we have reached a plateau of permanent prosperity. And you sell your stocks, and go to buy your basket of goods, and lo and behold, you get 60 units. No, wait, in 2009 at the low, when I bought the ES at 666, it cost me 100 units. Now, at ES 10,000, I'm a 'millionaire', the bull is never-ending, and I can sell for 60 units? How can this be?

Trust me, it can be. Deflation, in the guise of hyperinflation. Cool, eh? Look at the charts. The Dow has doubled since the low, there is no end in sight, and you've not made anything in real terms at all. Better than how much you've lost with your cash positions or your house, but not much of a 'bull', eh? And just wait until the real printing starts...

http://pricedingold.com/dow-jones-industrials/

If you recall my post about relative vs. absolute values (and depreciation) in currencies, then this should look familiar. Here's an article, and charts, to show what I am talking about. Notice how the world's strongest currency, the Swissie, has fallen just like the rest, but not as fast over the last year or so. That flattening, while the others are falling (notice the increasing spread on the chart), is what makes the Swissie vs. USD chart look like it is going straight up, while the buying power of the Swissie is actually falling, like all fiat currencies.

http://pricedingold.com/cad-vs-usd/