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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: orkrious who wrote (8023)	11/26/2001 11:52:05 AM
From: Softechie	Respond to of 99280

Deflation coming? Anyone think it's coming? Here's article on it. Last week I wrote that iconoclastic economists have been warning of deflation for almost five years, based on subtle signs that Alan Greenspan hasn't been supplying enough liquidity to meet the needs of the U.S. economy. And now — finally — these warnings have come true in the form of declines in the consumer price index, the producer price index and several other widely followed measures of prices. So suddenly everyone's talking about deflation — and not just the iconoclasts. Deflation isn't kind to stocks. For openers, deflation introduces complex distortions into the economy that make it harder for businesses to do business, and that's bad for all stocks. But more to the point, when the price of everything goes down, corporate earnings have to go down, too. And that means that stock prices will follow. luskinreport.com