-Caveat Lector- > The Imaginary Evils of > Deflation > by Christopher Mayer > [Posted September 11, 2002]
Mayer's article is superficial analysis. The reason pending US deflation is a bad thing is because it is asset deflation caused by deflating profits. Of course deflation caused by increased productivity can be a good thing but that is NOT what the US faces. The emerging US deflation is caused by asset inflation fed by irresponsible credit expansion by the Fed. This wild credit expansion results in overfunding of productive capacity which leads to "profitless" business activity caused by unsustainable business competition. Too much capacity leads to price deflation and declining profits. Profitless business activity stems from the overcapacity caused by wild credit expansion which causes a "race to the bottom" of product prices which ultimately causes increasing unemployment causing more price cutting etc. etc. The bottom line - deflation caused by steady profit margins enhanced by increased productivity is GOOD. Deflation caused by overcapacity and profitless business activity is BAD. flw <A HREF="http://www.ctrl.org/";>www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are unwelcomed. Substance�not soap-boxing�please! These are sordid matters and 'conspiracy theory'�with its many half-truths, mis- directions and outright frauds�is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. That being said, CTRLgives no endorsement to the validity of posts, and always suggests to readers; be wary of what you read. CTRL gives no credence to Holocaust denial and nazi's need not apply. Let us please be civil and as always, Caveat Lector. ======================================================================== Archives Available at: http://peach.ease.lsoft.com/archives/ctrl.html <A HREF="http://peach.ease.lsoft.com/archives/ctrl.html";>Archives of [EMAIL PROTECTED]</A> http:[EMAIL PROTECTED]/ <A HREF="http:[EMAIL PROTECTED]/";>ctrl</A> ======================================================================== To subscribe to Conspiracy Theory Research List[CTRL] send email: SUBSCRIBE CTRL [to:] [EMAIL PROTECTED] To UNsubscribe to Conspiracy Theory Research List[CTRL] send email: SIGNOFF CTRL [to:] [EMAIL PROTECTED] Om
