Just a word to me that seesm to be being used recently I have no idea what it really means?

As I understand it (and I'm told I really don't have a clue ) it means no jobs, no money coming in folks standing in bread lines. Reference US History, 1928 to 1934, I wasn't there but have heard all the horror stories. Oh yeah, one more reference, The Grapes of Wrath... a good movie and an excellent read.

You know I can look it up. But, I was hoping for input from Arjay and Jimbo, since I trust them. Some jerk writing somethign on the net I don't know I don't trust any longer. You know the experts

http://en.wikipedia.org/wiki/Deflation_(economics)

Well here it is doesn't look like a good thing to me.

There is also disinflation

Which seems to be the next step we may see from here, guess I better look that one up to

Some jerk writing something on the net

i thought that was us........

Do not confuse deflation with depression. They are not the same.

Deflation

deflation.......definitely something we don't have to worry about. that would mean an increase of the value of money. that hasn't happens since central banking took over and started printing the money. from day 1, the dollar started losing value. how else would they make a profit. debt and deficit, the world business way of profits.

Yes there seems to be three D words to learn what they heck else do I have to do

What brought to mind was Thailand mentioning it at some point adn really had no idea what the effect woudl be. Money value up costs down. Sounded prety good till I looked it up

Sorry Git, I was just going out last night when I spotted your post, and I didn't want to get drawn into long replies!

My understanding of deflation is falling prices - i.e. when inflation falls below zero, (instead of the more usual rising prices = inflation). So your money would theoretically buy more! It also involves a contraction in the money supply.

[Disinflation just means a falling rate of inflation.]

One of the implications of deflation being that it can create something of a vicious circle as people delay/defer purchases, thus further reducing the demand for goods and services, which Wikipedia explains nicely as the deflationary spiral:

This is the deflationary spiral. An answer to falling aggregate demand is stimulus, either from the central bank, by expanding the money supply, or by the fiscal authority to increase demand, and to borrow at interest rates which are below those available to private entities..

As demand for goods and services reduce businesses start laying of their work force.

I see you came across the same Wikipedia link as me, which explains it much better than I can, along with the implications!

http://en.wikipedia.org/wiki/Deflation

Here are a couple of articles about the affects of deflation, which is maybe what you are thinking about, and what the individual can do to try and protect his interests:-

http://www.gold-eagle.com/editorials_03 ... 21203.html

http://www.economywatch.com/inflation/d ... fects.html

http://ezinearticles.com/?Surviving-the ... id=1987408

http://www.bloggernews.net/118865

For the Yanks, our SS increases are based on inflation, so I'm wondering if we have deflation, will they want/take money back??

Actually Jetdoc, it's my understanding that Cost of Living increases is what makes the SS go up. This has been written into law but the same law does not address what will happen if Cost of Living decreases.

Thanks Arjay

Pakawala wrote:Actually Jetdoc, it's my understanding that Cost of Living increases is what makes the SS go up. This has been written into law but the same law does not address what will happen if Cost of Living decreases.

I don't ever recall entitlements being reduced due to downturns in the economy or cost of living. Have you ever heard of welfare, Medicare or Medicaid being reduced for that reason?

About the only thing that will affect entitlements is when all of us baby boomers are no longer in the job market and there isn't enough tax revenue to pay for all the free rides.

there isn't enough tax revenue to pay for all the free rides

i belive that time is coming very shortly. more benefits to pay out to those no longer paying into. would hate to be the people paying. 1/3 don't work, 1/3 collecting, 1/3 screwed. ouch