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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: koan who wrote (90429)	11/18/2008 3:54:25 PM
From: Proud Deplorable	Read Replies (2) \| Respond to of 116555

Just came back from the grocery store. Prices are unchanged. People aren't buying, that's not price deflation, that's fear of buying. People aren't going to stop buying things they really need but are resisting the fluff. That's not deflationary, that's just excess being rejected. That might be bad for the businesses that flourish in good times but this isn't going to cause prices of things that people live day to day on to come down. If market share is reduced and people aren't buying and suppliers cannot afford to drop prices in the face of less sales then they go out of business. That's not deflation in my understanding. I have a pet supply business and there is no way I will consider dropping my prices because I don't believe it will cause a turnaround in lower sales to a smaller customer base. Conversely my suppliers are not dropping their prices nor do I think they will. There is no deflation going on, simply now a society filled to the gills with unnecessary lifestyle junk is now not buying anymore. So if the govt gives these businesses money to stay bin business then how is this deflationary? If people aren't buying and retailers, like car companies, are slashing prices then how is this deflationary? I need more proof that material prices are coming down and I don't see it. I suspect they will not come down even as many more businesses will go under or reduce work forces, but prices of necessities won't come down, no way. The money supply will keep growing to bail businesses out and this will never end it seems. That's inflationary in my opinion.

To: koan who wrote (90429)	11/19/2008 1:59:57 AM
From: mishedlo	3 Recommendations Read Replies (1) \| Respond to of 116555

WASHINGTON (AP) - Treasury Secretary Henry Paulson told Congress on Tuesday that the administration remains firmly opposed to dipping into the government's $700 billion financial bailout fund for a $25 billion rescue package for Detroit's Big Three automakers, no matter how badly they need the help. breitbart.com I explained this yesterday in a comment on my blog Goldman Sachs and JP Morgan and (possibly C) are on the right side of credit default swaps with hedge funds. Mish