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The Moore Inflation Predictor forecasts the inflation rate one year into the future with 97% accuracy.
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What is the Moore Inflation Predictor©?June 2009 The Moore Inflation Predictor© (MIP) is a highly accurate graphical representation forecasting the future direction of the inflation rate. It has a 97%+ accuracy rate on forecasting inflation rate direction & turning points. And over 90% of the time the inflation rate falls within the projected "likely" range and 7% of the time it falls within the "possible" range. By watching the turning points, we can profit from inflation hedges (like Gold, Real Estate and Energy Producers) when the inflation rate is trending up and from Bonds when the inflation rate is trending down. In addition, the Moore Inflation Predictor forecast could be used to judge whether to lock in a mortgage rate or wait a month or two for a better rate. To see how well the MIP has done in predicting inflation see some previous MIP inflation forecasts with a reality line added. Note: Last month we added a blue shaded (under water) region to the MIP to indicate deflation. Current Inflation Prediction for 2009Current Inflation ForecastFor the third month in a row the rate of deflation has increased i.e. prices are lower than last year by a greater percentage than we were last month. The MIP is projecting that the downward trend will continue for a couple of months yet. But even if the rate turns upward it is predicting the inflation rate will remain negative (deflation) through October. Interestingly just as we had deflationary months before we had deflation on a yearly basis we have now had inflation on a monthly basis for several months, albeit low, but inflation none-the-less. So as extremely high monthly inflation numbers from last year drop out of the equation they are being replaced by lower inflation numbers. With the final result even more negative than the month before. So what does that mean for us personally and for the economy as a whole? Well, for the moment prices are relatively stable. We aren't spending $4 or $5 at the gas pump so as long as we have a job we aren't suffering too much. But as inflation takes hold the suffering will increase. As I've said before, deflation is a good thing if you lose your job or your wages or hours are cut. I would much rather see deflation than prices going up along with the unemployment rate going up as well. But once the effects of the "stimulus" package kick in we will probably see massive inflation. Generally, it takes about 2 years for monetary stimulus to result in inflation, so we could begin seeing massive inflation a year from now. Robert Prechter of the Elliotwave Theorist is forecasting deflation in spite of government actions to the contrary and at this point he is proving right. To read his free report on on Why we are headed for Deflation Click Here. Also see Saving the Banks Accomplishes Nothing for more information on why the government may be powerless to reinflate the credit bubble. Also See Elliotwave article Do You Know how to Preserve Your Wealth? for more information on investing for safety. Tim McMahon, Editor Disclaimer: At Financial Trend Forecaster we are not registered investment advisors and do not provide any individualized advice. Past performance is not necessarily indicative of future performance and future accuracy and profitable results cannot be guaranteed. |
 (click on chart for larger image) Don't miss next month's MIP Inflation Forecast! Yes, Notify Me when the new inflation forecast chart comes out!
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