Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : Deflation -- Ignore unavailable to you. Want to Upgrade?

To: Maurice Winn who wrote (167)	11/20/2002 9:09:53 PM
From: ahhaha	Read Replies (1) \| Respond to of 621

You mean it(deflation) to mean the rate of increase in prices reducing, You must not be familiar with pseudo pundits like Stephen Roach at Morgan. They have repeatedly claimed we are in deflation. Not only them but everywhere we see people concerned about deflation. This only proves how deluded they are and how little they understand about how world economies work in this era. Deflation has only occurred once in this country in 100 years. We had a mild deflation during the years '31 - '33. Since 1933 the CPI has never fallen. It isn't possible to have deflation because the FED won't permit it. Since FED won't permit deflation we only ever can have some degree of inflation. Therefore, discussions about deflation are absurd. It's a case of the emperor's new clothes. It's like discussing the color of unicorns.

To: Maurice Winn who wrote (167)	11/21/2002 4:24:53 PM
From: Maurice Winn	Respond to of 621

Harvey Rosenblum of the Dallas Fed on CNBC said the FED is trying to put a floor under the declining rate of inflation in order to prevent inflation from developing into deflation. This is pure pretense to knowledge and it's the source of all the monetary policy failures over the last 50 years. It's based on the assumption that the natural proclivity of economic activity is towards stagnation and depression. This is the core tenet of the demand management school of economics. Earlier Rosenblum had said the only thing restraining inflation was the economic reality of corporations' inability to raise prices. Griffith asked when he thought this would change and Rosenblum implied it would never change. Then why must FED provide artificial stimulus and according to Rosenblum, thereby preventing the economy from evolving into deflation? I think we have an implicit contradiction going on here. Can you see it? =========================================================================== Yes I can. Some people think that deflation is the same as disinflation. To make it clear, inflation is when prices are increasing overall and deflation is when prices are reducing - NOT when the rate of increase in prices is reducing. This is an enormously difficult concept for economic illiterates to grasp but there it is! Actually, the above was a quote I found in cyberspace which seemed relevant here. Ahahahaha is obviously confused. Mqurice