Robert Nabloid

The Coming Dollar Deflation

To the commentators... no point trying to convince the author - just like there is no point in the author trying to convince us. He doesn't recognize that dollars will be printed until there is no deflation - so there won't be any long term deflation - they'll ensure that isn't a problem.

I disagree with his deflation concern, in the long run. If the same thing had happened with any other currency on the planet, it would have failed by now. The USD is the reserve currency of the world - FOR NOW.

Land and gold and assets of that nature can be considered a store of wealth, not profitable "investments". They store value very well compared to the dollar or any fiat currency - show me ONE case to the contrary over the long term! You have a several thousand year period to show me a single fiat currency that did well in the long run and had no inflation.

Show me anywhere in the US where I can buy land or gold for cheaper today than I could a hundred years ago, or even 50 years ago. They may not be good investments, but they do store wealth much better than our fiat dollar. A lot of people confuse storing wealth with investing...

In the end, fifty years from now, the people that bought an ounce of gold or an acre of land still have just an ounce of gold or an acre of land. It is a store of wealth. Holding these items alone doesn't create wealth (unless you are holding land near a city you expect to expand and value the land more highly, etc, etc). Holding these items as a store of wealth will beat the person who just holds USD's as a store of wealth.

Inflation will continue to occur in the future. Deflation is a short-term issue. I don't see the deflation undoing what inflation has done for the last 50-100 years so it would be hard for me to consider the deflation a big problem... I expect things to get very bad in the economy and the Fed to continue adding dollars to the system. This does not bode well for the dollar in the long-term. In the last two months there has been a monetary base increase of over 75%! They aren't done either! It will affect things - maybe not today or tomorrow, but it will factor into the equation sooner or later.

We can argue against each other for as long as we want. Time will tell the story. Time. Not you, not me, not anyone of us commentators... TIME will tell the story.