There is a current incessant flow of articles warning us
of the certain economic calamity if deflation is allowed to show its
nose for even the briefest period of time. This ogre of deflation, we are told,
must be defeated with the printing presses at all costs. Of course, the real
objective of this fear mongering is to enable continued government theft
through debasement. Every dollar printed is a government tax on cash balances.
There are two main sources of deflation. The first
comes from a general increase in the amount of goods and services available. In
this type of deflation, a reduction in costs, in a competitive environment,
leads to lower prices. The high technology sector has thrived in this type of
deflation for decades as technical progress (e.g., the effect of Moore’s Law)
has powered innovations and computing power at ever-decreasing costs. The same
was true for most industries during much of the nineteenth century, as the
living standard increased considerably. Every man benefited from the increase
in real wages resulting from lower prices……To Read More……
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