Who buys the "Long term deflationary spiral"?

Quote from Random.Capital:

The "real data" is that Japan stimulated like a son of a bitch and has been fighting (and generally losing) the battle against deflation for nearly 20 years now.

Since we have an existence proof that the spiral is real, I am having trouble understanding what, exactly, you're asking.
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Come on... You can do better than that.

The amount of quantitative easing and stimulation matters. ie, popular consensus is that Japan did everything they could, but if you look at actual Japanese money supply data, you will see from 1990 to present that the United States actually outprinted the Japanese.

So my point stands. Give me some good data. Just because they did it doesn't mean they designed the program successfully. ie, if the Federal government did $100M of money printing and $100M of fiscal stimulus today, of course it wouldn't make a difference. The correct magnitude of stimulus is something the naysayers don't talk about (because I don't think it is in their interest to look at things quantitatively - they are too busy betting on cash and treasury bonds to argue such things).
 
Quote from thriftybob:

BTW, I think the possibility of a "long term deflationary spiral" would or will exist if the government stops playing borrower of last resort.

I don't think they will CHOOSE to stop borrowing, but I think it could get to where foreigners are no longer willing to lend the US government more. If that were to happen they'd either print us into hyperinflation or let us ride it down in a deflationary spiral. I get the impression they will try to ride a fence between the two called "quanitative easing". Isn't that what it is?
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Quant easing = politically correct word for money printing.
 
Here is a quote from Bananke's Deflation Speech in 2002

Thus, as I have stressed already, prevention of deflation remains preferable to having to cure it. If we do fall into deflation, however, we can take comfort that the logic of the printing press example must assert itself, and sufficient injections of money will ultimately always reverse a deflation.

It appears Bernanke would rather have the alternative. He will print money until deflation is reversed.
 
Quote from scriabinop23:

So my point stands. Give me some good data.
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If I believe strongly in the deflationary path, and you do not, how is it in my financial interest to help you understand why? If anything, helping you get on the right side of this issue can only diminish the potential profits for me.

So what's my payoff?

Sorry to put it in such mercenary terms, but after all, we are all traders here...
 
Quote from scriabinop23:

Come on... You can do better than that.

The amount of quantitative easing and stimulation matters. ie, popular consensus is that Japan did everything they could, but if you look at actual Japanese money supply data, you will see from 1990 to present that the United States actually outprinted the Japanese.

So my point stands. Give me some good data. Just because they did it doesn't mean they designed the program successfully. ie, if the Federal government did $100M of money printing and $100M of fiscal stimulus today, of course it wouldn't make a difference. The correct magnitude of stimulus is something the naysayers don't talk about (because I don't think it is in their interest to look at things quantitatively - they are too busy betting on cash and treasury bonds to argue such things).
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Why after five years of relentless inflation in every asset class on earth are people still obsessed with inflation? We had huge inflationary boom followed by a huge deflationary bust. Why would the bond market blow out now? It should have blown out years ago.
 
Quote from Random.Capital:

If I believe strongly in the deflationary path, and you do not, how is it in my financial interest to help you understand why? If anything, helping you get on the right side of this issue can only diminish the potential profits for me.

So what's my payoff?

Sorry to put it in such mercenary terms, but after all, we are all traders here...
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What makes you think me being on the same side of the issue as you will have any effect on your profits? I'm a tiny guy in this market, maybe smaller than you.

With that, I'm not convinced yet you can even support your argument if you tried.
 
Quote from scriabinop23:

Post your reasons why - using data to support your argument, not hearsay. Additionally, contribute why you believe money supply increases are immaterial. If you plan on using Japan as an example, use real data of money supply and stimulus to support your point.

Long term = 5-10 years, for this argument.

I am interested to see if anyone can come up with a convincing thesis from anything more substantial than an emotional gloom point of view that tends to self reinforce in times like this. ie if you assert credit will never recover, give examples in the past where credit issuance languished for long periods.
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the deflationary spiral is no longer an issue since the fed can print an arbitrary amount of money to offset deflation. Also, core consumer prices are very stubborn which is why the price of groceries has barley budged despite commodities and equities crashing.
 
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