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To: Les H who wrote (218263)2/2/2003 12:09:52 PM
From: studdog  Respond to of 436258
 
Deflation Tactics for the Investor?
From the information available, I have concluded that deflation is more of a threat than inflation. The vehemence of denial that deflation can be a problem was the clincher for me.
I understand that in a period of inflation, debt is good, as you pay it off in relatively cheaper currency. What is the situation in deflation? Is debt then the reverse, whereby you actually just get deeper in the hole as the asset owed on drops in price?

So, what would be the best strategy for the small investor (like me) in a deflaltionary period? It would seem that just holding lots of cash without any debt would be reasonable. Does gold go down in a deflationary period (it goes up with inflation, right?)? Do other assets (real estate, ala Japan) also typically drop?
Anybody got an answer to these questions?
If any of you are concerned about deflation, what strategy are you using to prepare for it?
Thanks

karl



To: Les H who wrote (218263)2/5/2003 4:34:40 PM
From: Les H  Read Replies (1) | Respond to of 436258
 
FASB Considers Revised Stock Option Rules, Releases FAS 148

The FASB first proposed that companies should automatically count the options as income in the mid-1990s, but a group of businesspeople and elected officials -- including U.S. Sen. Joseph I. Lieberman, D-Conn. -- opposed the plan. Lieberman, in an interview last year with the Connecticut Post, said that kind of accounting would hurt developing companies, particularly technology businesses, that depend upon options to attract high quality employees. In a compromise, the FASB published Statement No. 123, which gave companies the choice of either counting the options in the income statement or including them in footnotes within the annual report. Most companies opted for the latter choice, said Thompson.

"Unfortunately, many mutual fund managers apparently don't look at the financial section of the annual report," she said.

more at the link...

hr.pro2net.com