Ben Bernanke promised to make sure deflation doesn't happen by 'dropping money from helicopters', as much as required. Will he keep that promise? Deflation would be great for many people, fixed income pensioners and public employees can buy more each week, our savings go up in purchasing power before any interest is even added. Troubled debtors finally default rather than bail-out/ins which steals from savers to pay the debtors debts. As a saver I say bring on deflation. Bernanke is up to $2.8billion dropping per day, everyday. Unfortunately for deflation I believe him and Janet when they will increase the money drop as required. This debate reminds me of the following . . . "We will have hyperDEflation in everything measured against real money, GOLD (physical only, not paper), and we will have hyperINflation in everything measured against paper dollars (and paper gold)." http://fofoa.blogspot.com.au/2011/04/deflation-or-hyperinflation.html
Deflation is terrible for everybody, which is why governments will do anything to prevent it. There will also never be a SHTF event. Governments will do anything to prevent that as well. I am 100% certain the future is inflation - of goods and services that is, not asset prices. Inflation is the neatest, easiest solution to the problem of massive debt. It screws over savers but does it silently and without a direct connection to those causing it - a politician's dream.
The problem is that governments do not understand that they are the cause of the deflation so it is impossible to deal with it. You can not tax your way to a recovery. You simply place more burden on those that have a job. The more you tax the less is available to spend. All the q.e. has not done squat as it has not been redirected back into the economy. The q.e. was directed to the wrong section of the economy.
That's a great question. But isn't making the CNY a currency for settling Chinese trade recycling those exported Yuan? Creating an international CNY trading market over the past few years would also absorb trillions of CNY to keep it "liquid". I am speculating, but the exorbitant privilege afforded the USA for having an international reserve currency appears to be fast being realised by Communist China now.
You must have been educated in the last 100 years. Depressions are a normal and healthy part of the business cycle. Prior to the "Great Depression", all cyclical downturns were called depressions. They then added recessions to the economic language to make the Great Depression special. Depressions cause bad businesses to go out of business and wring the excess out of the economy. In the 1800s, depressions were a regular occurance and yet things kept getting better. Prior to the Civil War, depressions would offset the inflation caused by wars, etc. and that is why prices stayed stable for hundreds of years. People have been taught that inflation is normal. Inflation is not normal, it is the result of excessive government spending. It won't be pleasant, but we need a worldwide depression to reset values both monetary and personal.
The market will eventually take care of the reset. Countries with huge debts will have their currencies collapse, washing away the debt. Governments are banking on it - the Japanese are openly aiming for it - so is the Fed but they won't admit it. Obviously those that live in these countries will see high inflation as their currencies drop.
I see I'm not the only Yank on here (dang - I'm not "special") but interesting to me that the discussions here sound a lot like those in the states. Getting a sense of those discussions elsewhere was one reason I joined here.
Welcome.....Nice car too! Yes our rates are nearly as low as yours in the states...... We just lost Ford and Holden in this country 2016/17........I personally think we are witnessing very slow deflation each time we get more and more bad news in the media.....It makes people think twice about spending their money......Not sure about Hyper but def some deflation.
Not surprising that similar things are discussed. The people who gravitate to pms, are more likely to have lower views of government and lean more towards Austrian economics than the majority of people.
C'mon you should be supporting the locals......Mind you i personally dont buy new cars because they just depreciate like being drien straight off a cliff lol! I just did a service on one of my EF's. Engine Oil, filter, check front brakes and top up trans.....half an hour. lets see you do that on a BMW/Merc! :lol:
Deflationary pressures could aid gold as the chances of actual SHTF in hyperdeflationary case do look decent in this house of cards world. Imagine paying interest on $16 trillion in a hyperdeflation
