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To: philv who wrote (2989)	11/8/1997 11:09:00 PM
From: Ahda	Respond to of 116823

I question the word truth as truth is only good at certain points it too changes. Facts maybe compiled will get us somehwere. Uk is seeing inflation they raised their rates. Where i viewed our own economy with tendencies to be defationary i am now questioning my own veiw. Deflation is existant because of China's and Asia's ability to cheaply produce but in the same sentence i can state that the big eight CPA firms are the the big four and the buy out of Ralphs Quaility Foods and Hughes by Fred Meyer will definitely improve their bottom line but leave less room for comparison shopping on mine another big four. We have no unions to speak of in the country fighting to maintain labor wage yet we arn't exanding our manufacturing but contracting so we don't need. We are in dire need of tech people but we can get some of that filled in India for far less bottom line. Quality clothing has gone up significantly yet lesser quality is available for all at very low price. Inflation is very exisitant on fixed income and lower income but non existant on upper income brackets where some years ago the upper bracket was more spread than now. So this = confusing just yet at least to me. If i were Mr Greenspan i would load up the Fed with gold. No forward selling just holding and creating a monopoly as security our currency we back = our FED has the metal behind the dollar. Wishful thinking me in a very plastic world.

To: philv who wrote (2989)	11/9/1997 9:58:00 AM
From: Zeuspaul	Read Replies (1) \| Respond to of 116823

This author indicates confidence influences POG more than inflation or deflation pei-intl.com Taken from Market Myths on the Princeton site >>In the case of a gold standard era such as the Great Depression, the rate of spending declines but the hoarding of gold increases. Hyperinflation, such as in Argentina in the 1980's and Germany in the early 1920's, emerges when the consumer cannot hoard gold and thus he hoards tangible goods which causes prices to escalate rapidly. When gold is available, as was the case in the AS during the 1930's, money supply contracts causing deflation as consumers hoard their gold by withdrawing their saving from the banks. In each case, the consumer's lack of confidence in the system remains the common denominator and the effects of deflation and hyperinflation become indistinguishable in the final analysis. If interest rates and their effect upon the system were truly linear, then neither trend would be possible. Government could theoretically raise interest rates fast enough to prevent hyperinflation or lower them fast enough to prevent depression. Unfortunately, the Federal Reserve lowered its discount rate from 6% to 1.5% between 1929 and 1931, faster than at any time in history, with no effect whatsoever in relaxing the deepening depression. Interest rates rose rapidly during the hyperinflation of Germany and Argentina, again with no effective change in trend.<< bold added I believe this may have been posted here before but it is an interesting essay and worth reading for those who may have missed it