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  • Consumers Buy Into Disinflation [View article]
    good question. and i think todays deflation is driven by the collapse of wages that has been happening for a long time. its was just covered up by easy credit. easy credit dies (as you have no doubt noticed) so now its just wages.
    look out below!


    On Nov 14 04:54 PM Herbert Hoover wrote:

    > The Fed's printing presses are running 24/7. Deflation would be an
    > even bigger disaster to the real estate market. The "public" may
    > think there's disinflation but I'm willing to bet that we'll be seeing
    > an inflation rate similar to the late 1970's within the next two
    > years. It's the only way to save real estate.
    Nov 14 18:47 pm |Rating: +1 0 |Link to Comment
  • Consumers Buy Into Disinflation [View article]
    Don't think there is one. we are just on the one way down elevator. or we are just equalizing the US economy with the rest of the world.


    On Nov 14 05:40 PM Consider_this wrote:

    > Response to Hervert Hoover,
    >
    > Inflation of prices of items (not produced in the country) without
    > corresponding increase in *WAGES* of people is actually deflationary.
    >
    >
    > It's not hard to envision why if wages don't have inflation, price
    > inflation ends up deflationary overall.
    >
    > In the end, true inflationary spiral can happen only if WAGE is also
    > inflating.
    >
    > My problem is that with global arbitration of wages; and production
    > capacity of GOODS and ENERGY is outside of the country; and outsourcing
    > controlling wage increase domestically; the only way you can get
    > into an inflationary spiral within the USA; is if USD complete depegs
    > with the rest of the world and goes into a downward spiral.
    >
    > However, that kind of inflation-attempt would happen with a high
    > price: Cutoff of foreign goods and energy (too expensive); Cutoff
    > of govt funding; Removal of USD as a reserve currency.
    >
    > Because we will lose (reasonably priced) energy and foreign goods,
    > whether the economy will end up collapsing completely, thereby skipping
    > wage increase (to increase wage, you need to have functioning economy
    > and jobs), or be able to go into an inflation period, is unclear.
    >
    >
    > This is the part that inflation scenario arguments that I cannot
    > find. In pre-globalization days, it is possible to have Germany style
    > chaos; In modern integrated era, WHAT IS THE MECHANISM to achieve
    > overall wage gain?
    Nov 14 18:45 pm |Rating: 0 0 |Link to Comment
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