|
Deflation is bad? Cheaper goods would be harmful?
I found this article in the Post this morn and now I have a better understanding of deflation.
"William Greider warns of "a full-blown monetary deflation that would truly put the U.S. economy in ruin. In a general deflation, everything falls -- prices, output, wages, profits. Unchecked, this can lead to another Big D -- the Depression Obama claims he has avoided." James Bullard, president of the Federal Reserve of St. Louis, recently publicly expressed his fear that "the U.S. economy may become enmeshed in a Japanese-style, deflationary outcome within the next several years." Some major investors are not waiting to find out whether Bullard is right. The Wall Street Journal reported last week that such financial heavyweights as Pimco's Bill Gross and major hedge funds are stocking up on securities that they think will perform best in a deflationary environment."
__________________
"I see that you notice that I wear glasses. Well, it was to be. I've not only grown old and gray, I've become almost blind in the service of my country." - General George Washington
"There are times in your life you'll be required to perform an exceedingly difficult task to the best of your ability, regardless of your perceived capability. Mental toughness is what will carry the day during these times. In other words, you suck it up and do what you have to do." - Razor
|