Some economists talk about inflation as a hidden tax. If the cliche about taxes being as certain as death holds any truth then it should be reasonable to think of inflation in similar terms. Although I only took one economic class in college, I have a pretty strong interest in understanding how economies work.
In the current world economy with money based on trust, I am convinced that the creation of money to cover deficits is a likely occurrence. And that the destruction of money is something no one will do.
Therefore the total amount of money(based on trust) is almost certain to grow, and will probably never shrink. Despite the growth of the total amount of money, in certain cross sections of societies there will be shortages of money. It's essential to understand that Earth's economy this millennium produces inflation. That's a fundamental element of what makes it work. Of course like everything else in life there are eventually unforeseen changes. But this economic principal is so deeply rooted in our economy that it will most likely continue to exists for centuries or more. The moral of the story is: If you want to successfully participate in this economy it's important to be positioned to prosper from inflation, but have the ability to absorb economic bumps.
Defenses to the bumps are typically thought of as savings, bonds, or bomb shelters depending on how much money you have and what you're into. If you have the opportunity to put some of your income towards deflation resistant assets you may want to consider these things. I personally try to keep 20% to 30% of my portfolio in bonds and/or cash. I know they seem boring, but a portfolio without them is like a car without shocks. I'm not sure what a portfolio with a broken axle is like, but I have a feeling it would end up being a pretty expensive mistake.
sold some[~30%] TNP b/c of weak earnings. They will probably be back to normal by next quarter or so, but for now we've decided to put our money in things that have good P/Es now. This may well be overactive trading. Probably should have just waited. But am attempting to be "enterprising".
added to SSW. This looks like the best prospect now. Once TNP fixes their income then we will probably redistribute some money back into them.
Stepping out of our typical valuation strategies a little because of this companies outstanding working capital. The price to book looks a little higher than we usually go for.
we're adding to International Shipholding Corporation
good values, good dividends, good income.