Re: Deflation?

On Fri, 29 Aug 2008 14:04:40 +0000 (UTC), EskWIRED@xxxxxxxxxxxxxxxxxxx
wrote:


In the meantime, however, Bob is right: "it can be a real bitch".
Especially for folks that live off of their investments, both rich and
poor: stocks, hard assets and fixed income investments do poorly in such a
climate, with interest rates dropping even faster than sales of goods.

Efficiency inceases are the enemy of the unskilled worker, and in
today's world, unskilled labor is becoming cheaper and cheaper.
Domestically, we have illegal workers at slave wages. Internationally,
China has legal workers at slave wages. All over, robotic assembly is
gaining greatly, as capital becomes cheaper even faster than labor.

The fixed income retiree is scewed by deflationary forces in his
inestments, with the little bits and pieces he buys (food and fuel)
becoming more expensive, due to short-run phenomenon. Things will
eventually even out, but I fear that the middle class will not survive in
this country as a majority, but rather, that we will statify into rich and
poverty stricken, with fewer and fewer in the middle.

I believe that is why this is allowed to happen.


And that often leads to bloody revolutions. So I am somewhat confident
that The Powers That Be will try to preserve the middle class, rather than
lose everything to the proletariat in a bloody revolution.

I fear you are wrong. They WANT to destroy the middle class because
they are harder to control than the poor. A bloody revolution will
allow them to suspend the Constitution, impose martial law, and start
hauling the uppity middle class intellectuals off to the gulag. That
is what they want. They don't want democracy.

Hal


Like I said in another thread, I think that we are entering interesting
times.

If anybody over in sci.economics has comments, I'd be interested in
hearing them, most especially if I misunderstand How Things Work.
.

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