The causes of deflation are directly related to inflammation, and the only cure for inflation is deflation. Below is a list of the causes of deflation and manifestations of deflation leading to MORE DEPRESSION, which began in 2000 and may not end until 2020 (end of mania).
When looking for the causes of deflation, we need to remember that the real cause was credit inflation. Many of the items on this list are manifestations of a surge in the credit bubble. What is remarkable is the depth and number of related items in the list.
1. The growth of the government at all levels of the federal, state, district and city. Money is sucked away from the market economy to finance inefficient and bloated programs, reaching one-third of the economy, and then causing it to become heavy and steep.
2. Military waste. Wars and most of the money spent by all the various divisions of our defense departments are loved everywhere in the land — they are never seen. Oil, food, materials, labor, blood and life.
3. Governments support (favorite) industries that could not turn it into a free economy. Real Estate Bubble - unwinding lending practices.
4. Deflation of real estate, leading to a decrease in welfare and tax cuts to the government due to a decrease in capital gains tax and real estate taxes. By 2018, a 90% drop
5. Losses in the stock market. People feel poorer, so do not spend. Pension and retirement accounts lose money in stock and bond investments that affect the ability to pay a pension. Drop by 90%.
6. High oil prices suck money from the pockets of people who could go to buy goods and services on the market. We are all in the food chain using dead dinosaur deposits for our energy, not whale dipping as we used to. Money sent to foreign organizations, which in some cases are used to pay for attacks against us. Inefficient gas that absorbs cars, appliances, lighting and phantom loads on televisions, computers, microwaves, etc. Does heat rise to the right? Why are the working parts of refrigerators under the cooling zone? Heat rises through the entire fridge or freezer. All these years have been spending trillions of dollars in oil.
7. Loss of jobs - high unemployment means that there is less money to buy goods and services. Causes companies to lay off more workers as a result of a vicious circle snowball effect.
8. Collectibles, antiques, art, and property generally lose value. Lower prices when people try to sell. They feel less wealthy and cannot buy so many necessities. There will be a lot of deals in all types of property and property below, as people sell assets to stay alive.
9. The loan is tightened. Fears of banks and lenders lead to strict standards. Low interest rates are significant money on offer. This is a sign of weak demand and deflation. 10. Internet. Lower cost of doing business on the Internet means it's easier to start a business. Business and jobs go to the side of the cheapest suppliers.
11. Prices for agricultural products are falling. A small farm hurts the most. Reducing revenue means that they cannot buy as many goods and services as new equipment.
12. PIIGS. Portugal, Ireland, Italy and Greece. Ineffective government leads to high unemployment, which leads to the spread of ailments in Europe and the spread of the banking and labor crisis.
13. Interest rate falls. Savings and retirees who are counting on a safe return of their money have less money to buy goods, services, and to pay rent or home.
14. Savings rate rises from 0 to 7% already in 2010. It means less money for purchases. Hurts business.
15. Increasing the amount owed and paying by credit card means that there is less money to buy. Hurts business.
16. People travel, eat and rest less. Companies reduce the cost of first class flights. People cut their vacation plans. 106 motels are in circulation in the summer of 2010 here in the San Francisco Bay area.
17. Car sales and leasing. Bailouts GM and Chrysler. People keep their cars longer and fix them. The stock price of the auto parts store (AZ0) at the top.
18. Clothing and retail stores hurt when people cut and make less. Japan is in long-term deflation. Property values have just reached a 36-year low - the summer of 2010. The Japanese wear their clothes longer. We catch their disease.
19. Banking assistance and freezing. Trillions of derivative dollars are disappearing due to government intervention to try to fix the problem. The roar of 20-year inflation of up to 10% per year, bankers, fearing the money they lent, would be almost useless in just 10 years. They clamped down and stopped lending, forcing the economy to go into a tailspin. The same thing is happening now only in the whole world. A major depression will be 3 times longer and 3 times more than the depression of the 1930s.
20. The cost of lighting entertainment and sporting events. Robert Prechter sees sports star salaries falling here.
21. Reduction of state, county and city and dismissal due to both a reduction in sales tax and real estate tax revenues. 46 states are already in red. California has a deficit of 17.3 billion dollars. Illinois has a deficit of $ 13.5 billion. 5 states are technically bankrupt.
22. The CPI is falling. Consumer price index chart in a downtrend. The index does not include energy and food. Crazy.
23. Socialized medicine. 16% of the once active American free market economy was planned to be controlled, and a micro-controlled government. Killer at work and stimulator.
24. Cap and trade. More restrictions on business are becoming cautious and retreating. Work and aggressive killer.
25. Baby boomers retire. They pull out their savings by buying large houses. They begin to drain social security and medical supplies, rather than invest.
26. Bankruptcies are growing. People refuse to default. Business and lenders are weak - they write off losses and shrink.
27. Volatility is increasing. Flash of 998 points in Dow. Fear increases. People pull money out of the markets and put it in safe 90-day public accounts T with almost zero percent.
28. Bottles with a ratio of gold and silver April 2006 takes 80-100 October 2008. Silver is an industrial product. A weak economy means weaker demand, as evidenced by better prices.
29. Margin debt on shares reached $ 384.1 million. USA. 2008
30. OTC prices for moving stock prices and share peaks in 2000 with lower peaks in 2004 and 2006. The small total amount of dollars traded shows a tendency for the market foam to disappear at the same time as the 13-year head of the shoulders and shoulders.
31. Tea party. Nowadays people are dissolved. The mood has changed to pessimism about the government and elected officials. The surge in conservative talk radio (Rush Limbaugh, Mark Levine) and the conservative television show (Genn Beck).
32. Crime, gangs and mexican adviser and problems of the mexican drug cartel. Fear and higher cost of law enforcement and border patrol.
33. Video games. Unproductive. Reducing exercise leading to obesity and health problems. Addiction to break out of school.
34. Sale of licenses for sale in Michigan. People try to catch a source of protein in addition to their diets.
35. Private colleges. People who are not working try to retrain in another industry. Some end up with a big pile of debt and a real job opportunity.
36. Medical tourism is increasing. This is one third cheaper than medical and dental costs.
37. End of the release of society. People search the web and publish such as Consumer Reports to find the best and most durable products. Companies build the best products.
38. Selling sales of Kubota and other small tractor companies. enlarge - return to the country - return to the farm trend. Worry about crime and product availability. People are looking for an "elbow."
39. Xenophobia - closed communities. Fear others. Fear of strangers. People who can afford it, seek refuge in high-class life. Immigration is outraged at our Mexican border. Fear of a criminal wave.
40. Solar efficient shopping in home systems - security and savings.
41. Disintermediation. Borrowing short-term money for reversal and long-term lending. If interest rates rise faster for short-term money than the loans they made with money, they are made again, like what happened during the savings and credit crisis back in the mid-1990s.
42. Achievements of socialism. The futile growth of a government that allocates scarce resources instead of free markets. Dangerous.
43. Barack Hussein Obama - the socialist president hires and appoints all left-wing / liberal-minded people. Only 10% of them have work experience. No one has economic approaches. Gets anxiety, uncertainty and caution in business. To freeze.
44. Peoples mood weakens. News television speaks of "these troubling times." and now "these bad times." Negative social mood began in 2000. Realism and skepticism transform morphology and outrage.
45. New tariffs and trade sanctions. The Smoot-Hawley bill, passed in June 1930, raised tariffs by 20,000 imported goods during the Fed's presidency. The postponement of the American economy rebounded from the depression of the 1930s.
46. China and other countries with economies of growth. By providing cheaper goods and services, thereby occupying jobs and market share. Communist capitalism. They don't care if they make a profit. They want market share.
47. Terrorism. The extra money spent to protect us is a drain. Patriot Act. Hiring more government employees.
48. Position. Uncertainty is a business killer. Every minute congress (and every other government group) is in session, we lose more freedoms.
49. Taxation. Abolition of tax cuts in Bush. Business killer. Providing assistance means that US taxpayers take trillions of risks.
50. Problems in the Persian Gulf. Nuclear Iran. Hisbola and Hamas' hatred of Israel. Oil from the region is the lifeblood of the West.
51. Federal Reserve Bank. The immoral monopoly and the cartel. Currently, a poor schedule means that its portfolio now accounts for 50% of mortgage-backed securities and other types of riskier bank debt. His bag of tricks is empty, and short-term interest rates are close to zero. The Bernanke helicopter (We can take on helicopter cargo and dump it on any problem) is a graduate. In truth, he inherited the whole problem from Alan Greenspan and past fed heads and their friends of the bank. The Fed cannot stop deflation and the Great Depression.
52. Interest rates are rising. Then caught everyone who ran to bond security. As interest rates raise the price of Caspian bonds, which leads to a loss of capital. Robert Prechter believes that many corporate and government and municipal bonds will be useless in the depths of the Great Depression. States, counties and cities experiencing a decline in revenues due to falling household incomes, as well as declines due to a decline in the value of the property, already see that their bonds have been reduced to the status of undesirable activities by rating agencies.
53. M-3. The government no longer publishes cash supply data. What for? Perhaps, deflation first appears. M-3 was estimated to have decreased by 9.7%, which led to a large deflationary fall.
54. Banking failures. We have bank failures at rates that have not been visible since 1930. 1000 banks per year or more. So far, government regulators have slid down and either took over or organized a merger of problem banks. This will change as the number of bank failures increases. They will be out of money and forced to simply let them fail.
55. The FDIC has now passed to our government. The Federal Deposit Insurance Corporation has a fatal error. The nomination of troubled financial institutions makes them risk engaging in unsafe banking practices because they think the government will always be there to bail them out. Now we are with you, the taxpayer will be saddled with trillions in debt after departure, arriving at the FDIC.
56. Peak oil. 2005 is called the year of oil production. The high costs of oil and energy suck money straight from people's pockets. They refuse to buy other products and services, forcing these industries to shrink. Deflationary.
57. Debt stress. 46% in a recent survey - debt, underlined.
58. Credit card payments. For families earning $ 50,000 or more than 50%, they pay card debt.
59. Unemployment is about 10%. Do not forget that this does not mean those who stopped looking for a job, returned to school, retired or went to work. Perhaps another 15%
60. Lower commodity prices. Oil, many grains, wood, silver, copper, etc. Drop in price. Housing and automotive production uses a lot of copper. Down.
61. Real estate deflation. 50% price reduction in some areas. Builders confidence index is at a new minimum. Many of the many layoffs Many housing and commercial loans written at adjustable interest rates as early as 2005-2007 are suitable for dropping their rates or being due and payable. Many may not qualify for a new loan or be able to make a new higher payment. The Austrian school of economic thought says that every time there is a mania with credit inflation, it has the root of a big accident.
Every time Robert Prechter says that the bottom of a GREAT DEPRESSION will not be until 2016 or so. He thinks that prices will be reduced by 90% on most assets, Cash will be "king." If you have money at the time, your money will buy a lot of things at a discount. PS If you can come up with more causes of deflation, write them on the forum below. Copyright 2010 - http://www.deflationeconomy.com Reproduction rights are permitted with attribution.
