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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Mike Johnston who wrote (25906)	12/13/2004 12:32:11 AM
From: Elroy Jetson	Respond to of 306849

I agree with your comments that inflation causes a reduction in productive work and a corresponding rise in speculative activity, primarily because speculation pays better during inflationary periods and the profitability of normal business is impaired by the increasing costs imposed by an unstable environment. Many economists have demonstrated this repeatedly. As Joseph Schumpeter said, "inflation pushed far enough [would] undoubtedly turn depression into the sham prosperity so familiar from European postwar (WW-I) experience, [and]... would, in the end, lead to a collapse worse than the one it was called in to remedy." Inflation also discourages saving which forms the basis for Capitalism and wealth creation. People like Grace see Monetarist Socialism as a short-cut to wealth creation through speculation with subsidized debt. But the costs imposed on the economy by this welfare program far outweigh it's meager speculative benefits. .