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Politics : BuSab
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To: Jorj X Mckie who wrote (657)5/19/2009 1:23:39 PM
From: grusum2 Recommendations  Read Replies (1) of 23934
 
there's no outcry because there's little understanding of economics in the general population. in general, the population believes that the powers that be know what they're doing. i know, because i can remember believing that too. there's a couple other falsehoods the government, banks and some others want us to believe..

they want us to believe that deflation is bad. but deflation is the natural outcome of efficiency in the market. costs go down as efficiency is increased.

here's how to look at inflation and deflation.

INFLATION:

GOOD FOR:

banks: (inflate debt away and incentive for people to barrow)
governments: (a natural hidden way to increase taxes and devalue debt)
present homeowners: (home prices go up)

BAD FOR:

spenders: (everything costs more)
savers: (value of their money goes down)
future homeowners: (home prices go up)
the working poor: (hit the hardest)

--------------------

DEFLATION:

BAD FOR:

banks: (can't devalue debt and less loans needed because money keeps buying more and more goods)
governments: (tax revenues decrease unless raised by fiat)
present homeowners: (home prices go down, but even this is eventually good because they can buy the next home cheaper)

GOOD FOR:

spenders: (goods cost less)
savers: (value of money increases)
working poor: (they are able to buy more or perhaps even save some of the money they get)

in other words deflation is good for almost everyone except governments and banks..

--------------------

now what side do you think the governments and banks favor, the rest of the world (except present homeowners) or themselves?

keynsian economics.. the road to serfdom and tyranny paved by fascism..
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