I don’t get it, at all. If the price it costs to make [...]]]> Now I’m no econmist and I definitely don’t see deflation as an emergency. So the cost of some things is coming down. That’s not an emergency, that’s a good thing. At least to me. However the article at http://www.bloomberg.com/apps/news?pid=20601068&sid=a9qvRz4kZN18&refer=home would seem to say differently.

I don’t get it, at all. If the price it costs to make goods goes down then so should the cost to the consumer. If the cost to transport goods goes down then the consumer should get that cut, too. Prices should be coming down.

You see, for a long time economists have been warning that we, people, have to much debt and at unsustainable levels. Lol, sorta like the mortgage banks we were supposed to be bailing out to make the economy better. Anyway, that credit bubble burst along with the rest of them and consumers(people) are having a hard time paying their credit card bills.

Hey, if they can’t charge it they can’t buy it. Duh, prices have to come down in that case because of the law of supply and demand, less demand  = lower prices. Over supply = lower prices.  We, stupidly, let oil get so high priced it caused a rise in other prices and a even larger use of credit cards by people trying to survive.

However this time the banks were also in trouble so they wanted to raise more money so they cracked down on credit, raised interest rates to levels that would have sent them to prison less than 50 years ago.  It would seem that loan sharking is now legal and honorable.

Sheesh, can you imagine getting boosted to a 35% interest rate for no reason other than a greedy bank. Now theres a bellweather for ya. When the credit card companies start dropping interest rates to  keep the customers they have from filing bankruptcy.

So we have legalized loan sharking. Is this part of the problem with the economy? In my opinion the answer to that is yes. Just as greedy lenders were a part of the problem. Still are a part of the problem with the interest rates credit card companies are charging.

Kinda looks to me, like, in the long run, everyone is going to have to lower interest rates to keep even more bad debt from piling up on their books. Some day they’ll figure out that charging people more of what they don’t have doesn’t work out very well. One would think that would be obvious but I guess it’s not.

I’ve never been a fan of the trickle down theory and that’s what helping the banks, insurance companies and lender was. I like the trickle up theory a lot better. By helping the homeowners directly they would be able to renegoiate their mmortgages to something more affordable, the lenders would have less bad debt on their books and be getting income which they could then use to book some Spas in SoCal and give $50 million bonuses.

Congress rushed through a bailout that isn’t working, because they said something had to be done, then they loaded it with pork.  IMO they should have taken more time to think instead of acting rashly and without a clearly defined goal and a way to measure progress towards that goal.

So here we sit. Prices are falling and for some it seems it’s an emergency. Hmmm, I’ll bet the majority that find it an emergency are those that are selling something, not those buying something.  Gasp, furniture stores might have to get by with a 200% profit insteaed of 500%. Sheesh, ain’t that just to bad.

I just don’t see deflation as an emergency.