You Call This A Middle Class?

[4-2-7]

Originally Posted by finnbow

You're a self-proclaimed economic guru and you don't know the answer to this?

In a nutshell, with deflation people realize that things will be cheaper later than they are today. They will continue to defer purchasing things, thereby reducing demand (and production). This reduction in demand further decreases prices and causes the problem to worsen.

And if prices are over inflated by excess liquidly and ultra low interest rates we are making bubbles.

[mpholland]

Originally Posted by 4-2-7

And if prices are over inflated by excess liquidly and ultra low interest rates we are making bubbles.

So as long as you don't have to pay as much for something, the lower wages, layoffs, bankruptcies, and debt calling are OK? When would you actually purchase a non-necessity then and why? It will be cheaper next month.

[d-ray657]

"Excess liquidly?" Sounds like diarrhea.

Regard,

D-Ray

[finnbow]

Originally Posted by 4-2-7

And if prices are over inflated by excess liquidly and ultra low interest rates we are making bubbles.

Low interest rates are a reflection of low inflation, and vice versa.

[4-2-7]

Originally Posted by mpholland

So as long as you don't have to pay as much for something, the lower wages, layoffs, bankruptcies, and debt calling are OK? When would you actually purchase a non-necessity then and why? It will be cheaper next month.

You can't inflate prices beyond there value. Thats what we call the housing crises.

Her is where finn's chart originated.
http://howestreet.com/2013/12/deflat...eance-in-2014/

[Boreas]

Originally Posted by d-ray657

"Excess liquidly?" Sounds like diarrhea.

Regard,

D-Ray

As subject with which Neg. 5 would be intimately acquainted.

John

[finnbow]

Originally Posted by 4-2-7

You can't inflate prices beyond there value. Thats what we call the housing crises.

Her is where finn's chart originated.
http://howestreet.com/2013/12/deflat...eance-in-2014/

Actually not. Here's where I got it.
http://snbchf.com/economic-theory/deflationary-spiral/

[mpholland]

Originally Posted by 4-2-7

You can't inflate prices beyond there value. Thats what we call the housing crises.

Her is where finn's chart originated.
http://howestreet.com/2013/12/deflat...eance-in-2014/

Maybe you missed my post right after his that originated in my head. You most certainly can inflate prices beyond their value, ever bought a used car? Ever paid interest? Value can be very subjective.

[4-2-7]

Originally Posted by finnbow

Low interest rates are a reflection of low inflation, and vice versa.

lol that's funny I'm sorry, the fed set the interest rates. If they did not have them so low the US would default on the debt. But it's a catch 22 by creating bubbles, making more people take on debt. The bubble builds and builds until it pops.

[mpholland]

It may allow folks to take on more debt, but it doesn't make them. I am in less debt now than I was 5 years ago.