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.

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

To: Amark$p who wrote (101628)	9/5/2009 1:01:23 PM
From: mishedlo	2 Recommendations Read Replies (1) \| Respond to of 116555

I agree with Mish and you that we will have more deflation/pain in the short term. But Mish expects deflation to last decade(s). This is not going to happen, IMO. The US and American people will not be saving their money and reducing debt slowly over the next 20 years (to get the US total credit market debt as % of GDP from 376% to a more reasonable and sustainable level of about 175%.) I believe it will take a few short years under this scenario to get all the excess credit out of the system. This scenario seems plausible, even likely to me. And certainly no offense meant to Mish. Mish has explained deflation better than anyone else I have read with the possible exception of Steve Keen. Just my opinion... I have said it could. I rather doubt it does. What I expect is for the US to hop in and out of deflation for a long period of time, with extremely weak growth, sustained high unemployment, and low inflation (not necessarily deflation) similar to what happened in Japan. Japan did not have high unemployment because of the internet boom and job guarantees, neither of which now applies to the US, while our higher consumer debt levels make things worse. How long this drags out depends on how misguided Fed policies will be and how Congress reacts looking ahead. Those are unknowns. Mish