Why Deflation Will Be Long Term

I see a lot of economic thought that seems to stem from the fact that the authors really never liked to see people that weren't hoarding-sickies like themselves participating in the economy... I've known a few of those people, they just wait for the reckoning while they hoard money in their mattresses... anyhow the cited article says we have deflation because of debt bubble. Not necessarily, we have deflation right now due to a credit freeze up. What's up in the air for me is whether the powers that be want to fix it or capitalize on it, I'm thinking the latter at this point in time.

The politicians understand economics less than the average poster on ET, in fact they understand the Constitution and working of government less than the average voter believe it or not. The presses are running, that is my argument against long term deflation. Once we start to have economic growth the inflation has to start up does it not? Currencies are nothing but a commodity that is currently being oversupplied. Inflation is only held in check right now by the stalled economy of the world..
 
Quote from Fractals 'R Us:

I see a lot of economic thought that seems to stem from the fact that the authors really never liked to see people that weren't hoarding-sickies like themselves participating in the economy... I've known a few of those people, they just wait for the reckoning while they hoard money in their mattresses... anyhow the cited article says we have deflation because of debt bubble. Not necessarily, we have deflation right now due to a credit freeze up. What's up in the air for me is whether the powers that be want to fix it or capitalize on it, I'm thinking the latter at this point in time.

The politicians understand economics less than the average poster on ET, in fact they understand the Constitution and working of government less than the average voter believe it or not. The presses are running, that is my argument against long term deflation. Once we start to have economic growth the inflation has to start up does it not? Currencies are nothing but a commodity that is currently being oversupplied. Inflation is only held in check right now by the stalled economy of the world..
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So what is your position after all that.
Are you buying assets in this moment

regards
f9
 
Interesting point of view.....

But the proper way for government to get bigger....is for individuals to get bigger first....

Rather than implement TARP etc....

How about letting everyone keep all of their income except for a 10% consumption tax....

Then the people not the government would control the money....

Let the people innovate, save, produce, and create....

WITH THEIR OWN MONEY......

This is how the US can start creating surpluses....

In order for government to get bigger.....

The individual has to be bigger first.....

Unfortunately.....very few people grasp this very simple process....
 
Quote from libertad:

Interesting point of view.....

But the proper way for government to get bigger....is for individuals to get bigger first....

Rather than implement TARP etc....

How about letting everyone keep all of their income except for a 10% consumption tax....

Then the people not the government would control the money....

Let the people innovate, save, produce, and create....

WITH THEIR OWN MONEY......

This is how the US can start creating surpluses....

In order for government to get bigger.....

The individual has to be bigger first.....

Unfortunately.....very few people grasp this very simple process....
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not going to happen in my opinion anymore than people are guaranteed to start buying again once printed money hits the streets.
In theory they should (greed) but they may pay down debt (fear)

Actually greed =fear, but fear fear is stronger.
'09 is going to be interesting if nothing else.

I am in Puerto Vallarta in this moment.
The low RE is moving because it is Mexican, but the middle 300-800K is stalled, nothing moving after a sell off because it is foreign.
Will it move up or down .. should prove very interesting.
NE Brazilian RE is 60% of the pace right now and is stalled.
Will it move up or down.

regards
f9
 
Quote from Fractals 'R Us:

I see a lot of economic thought that seems to stem from the fact that the authors really never liked to see people that weren't hoarding-sickies like themselves participating in the economy... I've known a few of those people, they just wait for the reckoning while they hoard money in their mattresses... anyhow the cited article says we have deflation because of debt bubble. Not necessarily, we have deflation right now due to a credit freeze up. What's up in the air for me is whether the powers that be want to fix it or capitalize on it, I'm thinking the latter at this point in time.

The politicians understand economics less than the average poster on ET, in fact they understand the Constitution and working of government less than the average voter believe it or not. The presses are running, that is my argument against long term deflation. Once we start to have economic growth the inflation has to start up does it not? Currencies are nothing but a commodity that is currently being oversupplied. Inflation is only held in check right now by the stalled economy of the world..
More...

There is no credit crunch for worthwhile people or companies to loan to.

Lending rules are just getting back to the way it use to be 20 years ago.
 
Quote from jficquette:



Lending rules are just getting back to the way it use to be 20 years ago.
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That is a whole lot of deflation, so why don't we call this the great great recession and then the deflationists and the inflationists are all happy

regards
f9
 
Quote from achilles28:

You couldn't be more wrong.

WHY ARE BANKS INSOLVENT??

Because:

a) Toxic Mortgage Paper

b) CDS written on that paper and institutions who hold it.


Real simple, here.

Government buys ~2 Trillion worth of toxic mortgages.

Then nullifies all CDS as nonnegotiable instruments. Preferably, outlaws them.

Banks are then solvent.

That hasn't happened.

Why?
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So until it happens the banks are insolvent. Yes?
 
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