Article

2010-09-23 Economy

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Posted by Besoeker 2010-09-23 11:41|| || Front Page|| [11133 views ] Top

#1 Inflation, no.

Deflation, yes.

Posted by DarthVader 2010-09-23 12:05|| 2010-09-23 12:05|| Front Page Top

#2 No. It arrived decades ago, during the housing bubble.

Has Asset deflation occured?

Not enough to correct the economy.

Posted by Bright Pebbles 2010-09-23 12:06|| 2010-09-23 12:06|| Front Page Top

#3 Debka gets a salt girl graphic and Pravda doesn't?

Posted by Ebbang Uluque6305 2010-09-23 14:09|| 2010-09-23 14:09|| Front Page Top

#4 Debka gets a salt girl graphic and Pravda doesn't?

Adding graphics is advanced moderating, Ebbang Uluque6305. I don't know how to do that, f'r instance. Besides, it's under Opinion, not one of the news headings.

Posted by trailing wife 2010-09-23 14:47|| 2010-09-23 14:47|| Front Page Top

#5 They can have the old Weekly World News graphic.

Posted by Fred 2010-09-23 14:48|| 2010-09-23 14:48|| Front Page Top

#6 Better spend all your savings, just in case.

Posted by Iblis 2010-09-23 14:49|| 2010-09-23 14:49|| Front Page Top

#7 I read an interesting bit the other day which explained that hyperinflation is not just inflation writ large, but an entirely different phenomenon.

Inflation is typically thought of as production prices rising, followed by consumer prices rising. As such it can be caused by reduced supply, increased demand, or a reduction in the relative value of the currency.

Hyperinflation is when there are no longer safe virtual investments, such as stocks, bonds or futures. When there is a disruption in the markets, this results in a sudden flight to *physical* commodities, not just commodities on paper.

This sends shock waves through the consumer chain, because it interferes with the normal route from producer to consumer, which is "push" oriented, that is, producers only producing enough for the market.

Say a coffee producer has a normal market for 100 tons of coffee beans. So he delivers about 100 tons, which end up for sale on the retail shelves.

But then there is a hyperinflation flight to commodities, with investors taking physical possession of 80 of those tons, because they can pay more than the retailer who would normally sell them.

Overnight, there is only 1/5th of the coffee available for sale. The price of coffee skyrockets.

And not just coffee, but all other commodities, and all at the same time. Coffee that was $10/lb is now $50/lb. With big jumps in sugar, dairy, grains and flour, meat and oils, vegetables, and processed foods.

As well as oil and gas, metals, then just about everything else.

Posted by Anonymoose 2010-09-23 15:01|| 2010-09-23 15:01|| Front Page Top

#8 Ludwig von Mises was an economist who survived the German hyperinflation and then the Nazis. He thought the USA was immune to hyperinflation:
the great inflation and the Nazi scourge both derived from the mentalities and the doctrines that long dominated German public opinion. The State, which the German socialist Ferdinand Lassalle had already proclaimed as god, was supposed to be able to achieve anything. The omnipotent State was credited with the magic power of unlimited spending without any burden on the citizenry. Money, said the German monetary cranks, is a creature of the State; there is no harm in issuing infinite quantities of paper currency.
Fortunately, such superstitions are strange to the healthy common sense of America.
Common sense in the USA has become a scarce commodity lately.

Posted by Anguper Hupomosing9418 2010-09-23 16:25|| 2010-09-23 16:25|| Front Page Top

#9 Inflation (or hyperinflation) can come about because money is devalued. Too much money is printed to pay down the debt and it is worth less and less and less.

Posted by JohnQC 2010-09-23 18:17|| 2010-09-23 18:17|| Front Page Top

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