Falling Prices Raise a New Fear: Deflation
This week's news of a drop in consumer prices may sound on the surface like a good deal for financially strapped U.S. households. But economists warn that sustained deflation -- a period of falling overall prices -- would deepen the nation's economic troubles. Such a period would make it harder for people to repay debts and would prompt consumers to delay purchases in anticipation of lower prices and harder times. Full Story »
Posted by Derek Hawkins
The suffering from this period of deflation will be as noting compared to the deflation we will experience if we collapse the systems that provide many of our needs for free. Watersheds provide clean safe water for free. The Carbon dioxide feed back system provides us with breatable air at a reasonable temperature. Forests provide trees for cutting down for free and so forth. This period of deflation might just have come in time to save us from ourselves if we can make use of it. If we can come out the other side with our energy sourced from within our borders, that would be a good start. If we can develop a reliable, long lasting electric car with a practical range which is charged from new sources of renewable energy, that would help too. But most of all, if we can come out the other side with a new set of values that don't include rampid consumerism, that will be the most important insurance against what seems to be just around the corner. If we do get back to just a modest 2% growth, that means a doubling of our footprint in 35 years. Twice the water use, twice the food needed, twice the garbage and twice the pollution. Any of you out there experiencing a shortage of water in your regions. Imagine if demand doubles.