Deflation Watch pt 153 - International Edition

Generali

Wookster wrote: »

Can you explain what M1,M2, M3 & M4 are Generali?

I presume when you say deflation you are referring to falling asset prices rather than other goods and services (which are rising per the CPI)?

When I talk about deflation I am talking about falling prices of everyday goods and services. I realise they are rising now but I think there is a good chance, although not a certainty, that they will fall in the nearish future.

See purch for MS definitions.

lemonjelly

purch wrote: »

Yes, it's hard to see how there can be a 'real' recovery in the Economies of U.S.A./U.K./Eurolalaland whilst this contraction continues.

P.S. I will always resist this 'double dip' nonsense until there is a real sign of growth in the economy. To have a double dip you need to come out of recession and have some proper growth first.

purch, is it your contention that we haven't properly exited recession then?

Generali wrote: »

When I talk about deflation I am talking about falling prices of everyday goods and services. I realise they are rising now but I think there is a good chance, although not a certainty, that they will fall in the nearish future.

See purch for MS definitions.

Gen, an "M"s blog might be a worthwhile idea as it could give scope to explain why it is important.:)

purch

Yes.........:cool:

Wookster

Generali wrote: »

When I talk about deflation I am talking about falling prices of everyday goods and services.

I presume that would also extend to asset prices (such as houses/ stocks) if there was a significant deleveraging going on?

Generali

Wookster wrote: »

I presume that would also extend to asset prices (such as houses/ stocks) if there was a significant deleveraging going on?

A reasonable presumption.

Inflation = a persistent tendency for prices to rise
Deflation = a persistent tendency for prices to fall

Prices of some things can rise under deflation or fall under inflation.

lemonjelly

http://news.bbc.co.uk/1/hi/business/10173773.stm

retail sales are down for May (see link).

disappointing figures. They're blaming poor weather (I don't think so...)

hmmmm :think:

again we are getting up & down figures. But that said, kinda adds weight to Gen's perspective...

Generali

Just to make things perfectly clear, I predict neither inflation nor deflation. I predict that there is a bigger risk of deflation than has existed in the past and that risk is increasing and also underestimated IMO

purch

Methinks there is an Economist about :eek:

lemonjelly

Generali wrote: »

Just to make things perfectly clear, I predict neither inflation nor deflation. I predict that there is a bigger risk of deflation than has existed in the past and that risk is increasing and also underestimated IMO

Apologies for misunderstanding/misquoting you

michaels

Monetarism is so 1980s - velocity of circulation not being a constant not an issue?

No problem for the UK to keep its CPI/RPI positive what with currency depreciation and administered price rises like VAT, duties, regulated rail fares etc.