Monday, Nov 17, 2008
Deflation it is the Mr Brown!!!!
BBC NEWS: Cameron warns of 'tax bombshell'
"He said the danger next year would be deflation, adding: "This seems to be the only party that is now standing against what is a consensus developing across Europe and across the world."......correct up to the word adding
Posted by titaniccaptain @ 07:56 PM (713 views) Add Comment
11 Comments
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1. planning4acrash said...
Should We Worry About Deflation? Of course not. It's the people's best friend, especially in a depression. Article by Doug French.
2. alan said...
So, Prime Minister....after all that jetting about...
Are the government trying to put a floor under house prices or trying to prop them up, or what?
What are the government doing to protect UK industries, if at all?
Are the government wanting consumers to spend lots of money or save it?
.....He did mention homes, but I'm not sure if he wanted to buy them or build them....
The main message was..... tax cuts are coming. No mention of how they will be funded.
3. japanese uncle said...
Deflation is a good shock treatment to this debt-ridden economy. People will be strongly motivated to save rather than borrow and spend. Nothing is wrong. After the corrective readjustment ie GDP shrinking by 15-20%, UK economy will be in a much better shape.
4. unplugged said...
Is this the first mention of the D word in the mainstream news? The description of deflation on the news at ten just now went something like this: 'deflation happens when prices go down because consumers have stopped buying stuff'. Most helpful I thought!
5. str 2007 said...
On the BBC they were implying deflation would stop people spending as they wait for lower prices - you know like they did with flat screen tv's that started off at £4k and our now £400 for an equivalent model.
No I shan't feed my family this week as next week it will be cheaper to do so.
Oooh that cars come down to a sensible price I can afford, but I shall wait because it will get cheaper - hello cars always get cheaper - it's called depreciation.
I'm sorry but I just don't see how deflation will be a bad thing.
Even for the debt ridden - their daily costs will reduce therefroe they have more spare money to pay off the loans. Plus they'll have the added benefit of the Bank of England dropping interest rates through the floor in a government backed attempt to prop up the housing market - sorry stave off deflation.
6. titaniccaptain said...
"Even for the debt ridden - their daily costs will reduce therefroe they have more spare money to pay off the loans. Plus they'll have the added benefit of the Bank of England dropping interest rates through the floor in a government backed attempt to prop up the housing market - sorry stave off deflation."............spot on
7. The Baldman said...
Deflation is like global warming it is now the politically correct phrase. There is no evidence for it but it gives politicans an excuse to jet around the world and spend a shed load of our money!
8. greytornado said...
I am sorry to say, but Brown has got absolutely everything wrong. The greatest mistake that one can make is to think a deflation is coming because house and stock prices have collapsed. We are entering on of the greatest inflationary periods in history. Best thing anyone can do to preserve personal wealth is to buy something like gold bullion. Back in the days of the Weimar Republic, only the people who did this retained their personal savings.
9. Fjcruiser said...
Deflation turn into inflation as not every purchase can be postponed, like water, gas and electricity for eg. When these basic needs have to be supplied by the outside like in the UK, a lower currency means cost of imports will rise.
Deflation did not turn up into inflation in Japan because of the high savings rates of the population right accross the board. In the UK it is another story so deflation will last for a few months then inflation will hit like in Germany in the 20s and 30s beccause of the extrior debt which has to be repaid. It will be repaid by printing more money.
10. doom&gloom said...
Deflation is bad for debtors as they will earn less and less every year while the value of their debt and interest will stay the same, therefore deflation is bad for debtors and good for savers.
We will only see inflation rather than deflation if the government tries to print it's way out of trouble, The cost of doing this would greatly outweigh suffering deflation, therefore I predict we will see deflation (at least for the medium term)
11. sold out said...
This is not deflation its disinflation.Don't believe the lies.Hyperinflation is sitting on the horizon if they start printing money.
And we have the perfect party in power to do just that ZaNU Labour.