Re: Are we having INFlation or DEFlation..???
In my opinion you are exactly right and the rest are wrong... They are just using prices of "selected items" not all items as a messure when that is also wrong...
I hear you. And I certainly understand how money has been sucked out of the system, out of real estate, out of the stock market, out of businesses that disappeared, and that certainly applies here in Las Vegas where the locals found out how much construction contributes to the local economy -- and discovered it when that sector disappeared completely (causing our entire local economy to contract drastically overnight).
Actually, I think there is another factor affecting the availability of credit. Banks are applying all the money they are getting from the government to shore up their sorry looking balance sheets (as they write down billions in worthless assets). They worry about that first before they go looking for someone who qualifies for a loan.
But that is not what cheapseats wrote. He wrote "just about anything you can buy cost less today than 12 months ago."
Not correct. You have already listed things that cost less today than they did 12 months ago, but the vast majority of consumer goods and things that the poor spend their money on - are not cheaper. Another example on top of the ones I cite above: In this town, the poor ride the bus. The price to ride the bus just went up by 37% January 2009 in Las Vegas. Actually, when Jimmy Carter was the Pres., we had a name for something similar to this mess, Stagflation. Stagnation of the economy (no jobs, no growth) combined with inflation at the consumer level.
So the poor have drastically fewer job opportunities and everything they spend their few dollars on -- cost more. They don't invest in real estate, they don't play the stock market, etc. - you get the idea.