JWCB, SEMIS and DEFLATION
>> end of round 3 in a 15 round affair
The Nikkei peaked in the early '90s, where have you been?
As far as the Asian Tigers currency crisis, we are over a
year in, Numerous bourses are down 60-80%. IMHO, we are nearer
to the end than the start.
>> This is DEFLATION hitting our shores
Assuming that the big D washes across the Pacific, I submit that the semi-biz is the one industry is ready for deflation. By every conceivable measure (price per bit, MIPS, mHz, bandwidth whatever) semi/computer/disk prices decline and have been persistently declining in real terms for decades.
Worried about liquidity traps? If you've ever upgraded a computer, you know that by waiting you can always get one that it cheaper and faster. The whole decision about when to upgrade a computer is one giant liquidity trap. A little deflation isn't going to change this.
IMHO, the deflating prices of computers, disks, etc brought about by Moore's law is a far greater force than the deflation currently being "exported" from Asia. Yes, at the margin there is some effect and you are correct here, but the deflationary effects caused by a lot of formerly command economies going capitalist aren't going to be the end of the world.
regards |
