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Latest Comments12 Comments
Risk of Long Term Deflation Is Low but Growing
Risk of Long Term Deflation Is Low but Growing
Hyper-inflation causes people to spend money as soon as they get it. Clearly. Deflation prompts people to save money, because they can buy something for less money by waiting? It sounds logical, but is that what's really happening right now? Isn't the American consumer plain tapped out? Isn't it worth the distinction, if we want to raise the spectre of deflation?
Deflation in Japan, I don't know much about that. But I do know that the Japanese have always been notorious savers. Hasn't their government always had a problem stimulating consumer spending? We don't have that problem here, in fact, we have the opposite problem.
Can anyone paint a real picture of what deflation in the US would look like, and why it would be disastrous, aside from deflation as the corollary to hyperinflation. The author refers to it..." The U.S. economy has experienced deflation in the past, but not in a very long time." Was it really that bad? I don't know, I was a kid then.
I live in Los Angeles. Home sales are up because prices are down. Something like 50% of homes sold were foreclosures last month. The market is moving. Sounds like deflation is working to me.
Seriously, anyone with a better explanation.
First Compare Today to the Early 1980s
On Nov 26 02:49 PM Smarty_Pants wrote:
> USDebt:
>
> 1980 (2008 dollars): $2.44 Trillion
> 2008: $10.65 Trillion
>
> Seems like we are dragging around 4x as much government debt as we
> were in 1980. I couldn't find readily available numbers for private
> debt levels to compare, but I would guess that they are much higher
> today than they were in 1980 as well.
>
> Ditto for budget deficits and trade deficits.
>
> And how about banking sector reserve balances? Things are much worse
> now than ever before:
>
> 1980 (2008 dollars): +$52 Billion
> 2008: -$330 Billion
>
> So banks are over 6x further in the red than they were in the black
> in 1980.
>
> Things actually are different from 1980 and in areas where the differences
> matter. Your above comparison is superficial at best.
First Compare Today to the Early 1980s
On Nov 26 02:49 PM Smarty_Pants wrote:
> USDebt:
>
> 1980 (2008 dollars): $2.44 Trillion
> 2008: $10.65 Trillion
>
> Seems like we are dragging around 4x as much government debt as we
> were in 1980. I couldn't find readily available numbers for private
> debt levels to compare, but I would guess that they are much higher
> today than they were in 1980 as well.
>
> Ditto for budget deficits and trade deficits.
>
> And how about banking sector reserve balances? Things are much worse
> now than ever before:
>
> 1980 (2008 dollars): +$52 Billion
> 2008: -$330 Billion
>
> So banks are over 6x further in the red than they were in the black
> in 1980.
>
> Things actually are different from 1980 and in areas where the differences
> matter. Your above comparison is superficial at best.
Mitt Romney's NY Times Op-Ed On the Automakers: Dead On
However, N American operations for both GM and Ford are completely out of touch. Both companies do outstanding in Europe, and are successfully penetrating China, Russia etc. Amazing cars in other countries which leaves you scratching your head, why don't we get these cars. Well, NA can only make a profit selling high margin trucks. The union/labor legacy issue has to be dealt with. Where else can you go to work at 18, retire after 40 years, then have someone pay you to do nothing for the next 25? We live longer and our health care costs more. Defined benefit plans all across the country are going to be in the same boat. They have to go. It's a raw deal for workers, but that's a holdover from another era.
On Nov 20 11:51 AM John D wrote:
> Now that it's getting down to the crunch can someone explain ONE
> thing to me, in a country where the government spends TRILLIONs on
> WAR in other countries (I realize it's to protect the US as well,
> but) why would the government not do as much at home to protect democracy
> & the industry that has been supporting a VERY large part of
> the country for a century now. Is it fair to bail out Wall St. (they
> finally found the weapons of mass destruction - right on Wall St.)
> and not the millions of citizens that will lose the taxpaying jobs
> that would help contribute to the taxes to cover the financial system
> failure. I find that much of the resistance is nothing more than
> the arrogance of certain senators who's states are not affected as
> much. If they feel that Toyota & Honda will contribute as much
> to their country than GM - Ford & Chrysler they are seriously
> mistaken - those profits SUPPORT their countries - Americans are
> just paying for it. Perhaps the question they should be asking is
> why North American Auto makers are not allowed to sell freely in
> Japan & Korea, maybe it's because those governments are not blinded
> by arrogance. If the North American governments had sought an EQUAL
> trade deal instead of a FREE trade - dump what ever you want here
> - deal, the Big 3 would have been sitting in a much different position
> now and actually be helping to pull the economy out of recession
> - "Buy an import and drive North America into DEPRESSION"
Mitt Romney's NY Times Op-Ed On the Automakers: Dead On
However, N American operations for both GM and Ford are completely out of touch. Both companies do outstanding in Europe, and are successfully penetrating China, Russia etc. Amazing cars in other countries which leaves you scratching your head, why don't we get these cars. Well, NA can only make a profit selling high margin trucks. The union/labor legacy issue has to be dealt with. Where else can you go to work at 18, retire after 40 years, then have someone pay you to do nothing for the next 25? We live longer and our health care costs more. Defined benefit plans all across the country are going to be in the same boat. They have to go. It's a raw deal for workers, but that's a holdover from another era.
On Nov 20 11:51 AM John D wrote:
> Now that it's getting down to the crunch can someone explain ONE
> thing to me, in a country where the government spends TRILLIONs on
> WAR in other countries (I realize it's to protect the US as well,
> but) why would the government not do as much at home to protect democracy
> & the industry that has been supporting a VERY large part of
> the country for a century now. Is it fair to bail out Wall St. (they
> finally found the weapons of mass destruction - right on Wall St.)
> and not the millions of citizens that will lose the taxpaying jobs
> that would help contribute to the taxes to cover the financial system
> failure. I find that much of the resistance is nothing more than
> the arrogance of certain senators who's states are not affected as
> much. If they feel that Toyota & Honda will contribute as much
> to their country than GM - Ford & Chrysler they are seriously
> mistaken - those profits SUPPORT their countries - Americans are
> just paying for it. Perhaps the question they should be asking is
> why North American Auto makers are not allowed to sell freely in
> Japan & Korea, maybe it's because those governments are not blinded
> by arrogance. If the North American governments had sought an EQUAL
> trade deal instead of a FREE trade - dump what ever you want here
> - deal, the Big 3 would have been sitting in a much different position
> now and actually be helping to pull the economy out of recession
> - "Buy an import and drive North America into DEPRESSION"
Death by a Thousand Rate Cuts
Poll Shows 73% Americans Think Starbucks is Overpriced
Starbucks on Sale (Part I)
In Light of Peak Oil, Financial Diversification Is a Bad Idea
Greenspan: Bubbles Are a Necessary Part of Innovation
"Incidentally, I see the dot-com boom as being primarily driven by corporate Y2K spending.."
Pets.com et al was Y2K corporate spending? I see.
Broadwind Energy: Cramer, Someone Had to Say Something
Is the DeWind turbine special? Someone has mentioned it doesn't need expensive, patented, power conversion gear the GE turbines have.
How and where does DeWind plan on cashing in? Internationally? Any thoughts Windpro?