Inflation vs Deflation

[Fransisco]

[Fransisco]

I like the line, " You can't tax deflation."

Its an interesting observation that I've never heard before.

[liberty]

I have to agree with Harry Dent's assertion that the Fed is run by people who literally have no idea what they are doing, and that they are going to go down the path of quantitative easing not until they succeed, but until they fail, because they can't conceive of any other course of action.

Central banks around the world are not run by wise men, but by idiots. Average Joe Citizen can do nothing to change what these institutions do, but he can take steps to protect himself from the worst effects of their policies. That requires making firm financial bets on inflation, not deflation.

[TOM4CWB]

Fransisco,

TAXATION is the Key.

The more the currency itself devalues... (inflation) the
more money for government.

Simple. Deflation kills everything. Which is why we will
be as Japan was for the past 2 decades...

Productivity and sustainability need to be in balance.

Which is why inflation numbers are skewed to be low
and stable.

What could a US$ BritishLB or Cdn$ buy in 1900?
1950? 2000?

We should NOT be charging interest on lending $$$ to
our own people in the first place. Then instead
currency earns wealth... not strangle innovation and
productivity.

[Hopperbin]

Silver Standard Prices Offering of US$250 Million of Convertible Senior Notes

To cover maturing notes.

share price down 8 percent in one day more like immediately

[Hopperbin]

Fran why could you not tax deflation? We have been fortunate with increased wages and wealth in Western Canada. Our taxes have gone down a lot, is not Sask corp tax now at 2 percent????? That is a result of increased wages, and corp profits. If it were to all fall apart the tax would be back where it was or more. Increase the tax rate.

[Hopperbin]

If you have deflation your going to have to increase the tax rate. Unless you invite a million Chinese with a trillion dollars to come move here turn a blind eye to their money supply and the next generation say no taxes free transition to the next gen cause we have no juristiction in china any way, So the Chinese that come here get trillions of tax exemption while they avoid their own countries taxes, can help but if you do not tax them in the end it still does not help the situation. There is a reason all the Chinese coming here do not become Canadian citizens they will die first. So they can transfer millions from China tax free.

[Hopperbin]

Should have kept the ex wife, could have paid her 200 thousand a year tax exempt cause all she has to do is say it came from China. She was pretty good looking also.

[Fransisco]

I would think you would have rioting in the streets if you kept increasing tax's when everybody's wages and assets are decreasing.

[FarmRanger]

"BOJ Increased Monetary Easing Efforts Pushing
Yen Lower"
"The Japanese Yen traded lower versus its major
counterparts as the Bank of Japan announced an
additional 10 trillion yen of asset purchases in an
attempt to provide support to the economy by
conducting monetary policy in an “appropriate
manner”, according to the released policy
statement. The bank also decided to keep their
key borrowing rate unchanged at 0.10 percent."

http://www.dailyfx.com/forex/market_alert/2012/09
/19/BOJ_Increased_Monetary_Easing_Efforts_Pu
shing_Yen_Lower.html

[cottonpicken]

Inflationis is a tax!!!!

Thats how a state covertly steels wealth from a
citizen.

[wd9]

The interesting thing is deflation is
really only an issue for people who own
stuff, like pretty much all the posters
on this site.

Remember, lots of people own squat with
huge debts. Deflation is looked upon as
a good thing, as in "i can buy more
stuff on my visa after i go bankrupt".

The numbers of retirees with diddly
saved is shocking and completely
supports this argument.

[liberty]

While the number of present retirees with tiny savings is troubling, that's nothing compared to the even bigger numbers of future retirees who are making huge mortgage payments at the expense of retirement savings. They're betting everything on a continually rising housing market as a retirement fund. We all know how well that worked out for Americans.

The basic problem with inflation is this: printing pieces of paper does not make you wealthier. It doesn't matter who prints them, whether it be a central bank or Congress or Parliament.

[Fransisco]

More people have "stuff" than you might think. Most peoples retirement money is tied up in stocks in one way or another. RRSP's, mutual funds etc. Stocks are stuff too. Deflation would bring the value of all them down as well.

Now forget about what the fed is doing with the money supply for a second and think about what's going to happen to the value of stocks once the baby boomers start cashing in their retirement savings. That is another potential deflationary event just around the corner.

[BTO_farmall]

Liberty says - " Average Joe Citizen can do nothing to change what these institutions do."

Uh, Uh, Uh, Not So Fast Sonny!!!!!!!!!!!!

"This country, with its institutions, belongs to the people who inhabit it. Whenever they shall grow weary of the existing government, they can exercise their constitutional right of amending it or their revolutionary right to dismember it or overthrow it."

-- Abraham Lincoln, 4 April 1861