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$2.67 pilbara minerals limited

PLS chart, page-4957

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BabaRoga_space

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26/01/22

10:51

Post #: 59137238
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Originally posted by SF@HC: ↑

Yes I understand how inflation destroys purchasing power, if for example wages growth/inflation is behind the goods and services inflation curve, and right know, yes agree, the central banks are in a hot spot, but as said, I believe some items are transitory (cost of energy and shipping/freight to name a few), so lets hope the tightening doesn't overshoot.

My original reply to you post was asking what long term inflation rates (thus interest rates) you used to arrive at the real value of the property example you provided. Yes if inflation remains elevated, the cost of owning that property increases (rates, maintenance, insurance) and any associated debt through higher interest rates, all of which would be a headwind for the performance of that asset.

Many analyst commentary is suggesting a rough Q122 due to disruptions from omicron variant rapid infectious rate. But all going well, once it has flushed through the population, economic activity can normalised putting the brakes on inflation, thus interest rate hikes, so once again, lets hope some of the baked in/expected tightening is not required.

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I didn't use inflation rates, I used round numbers for illustration purposes.
The posited argument I replied to was: that inflation is good for asset prices and thus wealth increase.
I just used round numbers to illustrate that inflation can destroy wealth over time in real terms even do asset value has significant growh over the same period.
We weren't predicting interest rates or discussing current interest rates/inflation that would require real interest rate/inflation calculation

PLS Price at posting: $3.25 Sentiment: None Disclosure: Not Held
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