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The Joy Of Deflation


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2008 Dec 18, 1:48am   35,666 views  285 comments

by Patrick   ➕follow (59)   💰tip   ignore  

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Why is deflation written about as if it were a bad thing? Personally, I love deflation because it means lower prices for pretty much everything.

OK, I can see that people will hold cash instead of investing it, because the cash is increasing in value. But that will end eventually as people spend the cash (unless the Fed just prints forever).

And I can see that it's hard to start up a business knowing that profits will probably decrease in nominal terms, but that can be managed, because costs will decrease as well. And if the business generates cash, that cash is more worth getting in a deflationary environment.

Maybe deflation is exactly what we need for a while, to wipe out foolish debtors and get the economy back into a sustainable state.

Patrick

#environment

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281   OO   2009 Jan 4, 2:01pm  

Open Office works just like Office, in fact, it is better, because the new Office changes the location of menu just for the sake of it - or else people don't know why they are upgrading.

I don't know enough about Google to compare it to Microsoft. But here is something that I observe among my friends at both companies. The Microsoft friends (from at least 3 different groups at Redmond) are very open about the issues within Microsoft, politics among internal orgs, and their product plans etc. it seems to me that they do not really care about Microsoft, because if I care about my employer, I would shut the hell up and only do the official line even in front of friends. There is no pride of employment.

My Google friends, however, are very hush hush about what they do, what the internal org is like, and revert to official lines for all my product plan questions. It seems to me that they care about their employer, and their own employment. There is plenty of pride of employment.

282   justme   2009 Jan 5, 2:00am  

OO,

The differences is mainly attributable to the relative ages of the companies.

283   justme   2009 Jan 5, 4:22am  

Leon Panetta for CIA Director !! Damn, Obama is smart.

284   justme   2009 Jan 5, 6:48am  

PermaRenter,

There was a photo of Tessa Donnelly in the paper, and the worst part of the whole story is she was NOT worth fighting over by any stretch of the imagination.

And what kind of freak couple talks on the average of 9 times a day over several months. And the rival was not far behind -- at the same time! Some people....

285   kewp   2009 Jan 7, 7:43am  

You beat 12%-24% on your investments last year (1%-2% per month)?

I only made one investment over the last two years, the double-inverse financials ETF, SKF.

Once I doubled my money I cashed out.

My investment philosophy is to stay all in cash and then take short positions against collapsing speculative bubbles. It's worked well for me so far!

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