Deflation is only likely if there is further disruption in distribution channels and raw materials prices continue to decline.
Neither situation is very likely.
What I find amusing is that this is the same David Taylor who back in the beginning of the year was screaming at my ignorance regarding oil prices, which he claimed were going to cause gas to top $2 per gallon. Not only didn't it happen (as I said it wouldn't), prices have declined since their peak in early June.
Deflation has appeared in a very mild form at the wholesale level for 2 primary reasons - inventories are still relatively "high" (kind've a weird point since they aren't in comparison to past highs, but from a percentage basis from their low it is high), and 9/11 has had a major dampening effect on spending. As a result, the 3rd quarter deflator showed early signs of "deflation". However, the CORE deflator ROSE .4% (always keep an eye on the core, that is the real rate, David, I told you that 8 months ago).
So...deflation is possible, but not imminent. Certainly not with interest rates where they are and falling, and refinancings up 500% in the last month.
As for David saying he didn't engage in name calling...well, that's a laugh. If I had the mind, or the time, I'd cull through about 5 posts where he was quite nasty to me....not to mention other posts where he was really nasty to others on this thread. And back then, I made it clear I didn't agree, but supported his right to post. Why he started calling me names and throwing rocks was beyond me. Friggin idjit is all I can guess.
BTW, there was a guy on USEnet a while back who I corresponded with for a while. He worked for the Navy developing hydrodynamic noise dampening devices for subs. Basically, the premise was the last sound the prop made was somehow related to the next sound it would make given certain conditions. His program allowed the sub to "guess" the sounds, and transmit signals that drowned out the props' sounds. He was using this concept to develop a short term trading mechanism. I lost touch with him. I wonder how it turned out? |
