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History has shown "stocking up" on electronics is wrong, no matter if low, high,
negative(de), or stag inflationary stance. In fact, most technology goes down over time
no matter the level of "technology".
Suggest you read the on line version of T.E.O.T.W.A.W.K.I. - if one is to depend on
worst-come-to-worst.
I suspect if we are truely in a deflationary economic position, one should buy those
things which they know they will have a assured demand.
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Y2k might change several implicit economic assumptions. the last couple of decades we have seen a steadily improved price/performance ratio on many technological products (e.g. just think of MIPS/$ of PC's during the last 10-15 years).
This steady improvement is based on a lot of assumptions and constraints that might well be not valid for an extended period of time (i.e. throughout 2000 at least in a 'bad case' scenario:
- JIT working without major flaws
- banking / payment systems in place
- transportation systems still functioning
- single placed sourcing of essential components in place. E.g. most of the hardware cards are produced in SE Asia; NOT in North America. Combined with a possible breakdown in air and sea transportation for at least several months; and combined with an increased demand for replacement of non-compliant PC's well into 2000; and we might actually see a significant price increase in PC' (possibly a black market!? - think of Soviet Union during 1970-1990)
When these assumptions are not true for some period in time, we will see a combined inflation / deflation scenario:
- deflation for goods that can still be readily produced, transported, paid for
- inflation for goods for which this is not true. This might WELL be electronic equipment, such as PC's etc, IMO
Any thoughts?
Bottom line for me: Y2k may well change several 'ground rules of the game'.
John |
