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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: LindyBill who wrote (297678)	3/22/2009 8:00:32 PM
From: unclewest	Read Replies (1) \| Respond to of 793964

We have two separate phenomenas going on with our currency. The internal inflation that averages about 2% a year, and the external value against the other fiat monies. The 2% figure means that when just looking at internal factors, our money supply increases about 2% more than our goods and services. LB, Thanks for the thoughtful response. Do you believe, as many do, that even with a skyrocketing money supply, we are in a period of deflation right now? And if you do, how does that reconcile with your formula? And if there ever is a recovery won't the increase in supply reverse to accelerating inflation? You and I were stationed in Deutschland in the days when the dollar to West D-Mark ratio was 4:1 or better, and the East D-Mark was 28:1. At that time, the West German economy was barely breathing. The East was still mostly bartering. I can recall doing recons in East Berlin when we were told to carry extra fuel because they had only one gas station for one million people. Do you really think we will be better off if things deteriorate to the point when one euro buys 4 dollars? I can visualize the build-out from there...but man that means a lot of pain will have been endured. If that is the way to go...we should get on with suffering the pain of our excess consumption. uw