Pretty much everyone hates inflation, and there's little wonder why. Nobody likes paying higher prices for goods and services (even as inflation actually reduces the burden of debt). Deflation, on the other hand, has instant emotional appeal. After all, who doesn't like a bargain? But deflation is a far more serious economic problem than inflation -- and most folks don't really know why. Gary Shilling, president of economic consulting firm A. Gary Shilling & Co. and author of the just-published The Age of Deleveraging, explains why falling prices are indeed scarier than rising prices.

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FLY

Tax his land, tax his wage, Tax his bed in which he lays. Tax his tractor, tax his mule, Teach him taxes is the rule. Tax his cow, tax his goat, Tax his pants, tax his coat. Tax his ties, tax his shirts, Tax his work, tax his dirt. Tax his chew, tax his smoke, Teach him taxes are no joke. Tax his car, tax his ass Tax the roads he must pass. Tax his tobacco, tax his drink, Tax him if he tries to think. Tax his booze, tax his beers, If he cries, tax his tears. Tax his bills, tax his gas, Tax his notes, tax his cash. Tax him good and let him know That after taxes, he has no dough. If he hollers, tax him more, Tax him until he's good and sore. Tax his coffin, tax his grave, Tax the sod in which he lays. Put these words upon his tomb, "Taxes drove me to my doom!" And when he's gone, we won't relax, They'll still be after inheritance TAX!

November 24 2010 at 12:16 AM Report abuse rate up rate down Reply
tazgadon

Nothing is going to solve our problems people who have...have no compassion for people who don't...count your blessing not everyone can achieve its not just the mentally challenged or the so called lazy on welfare... this country was built by people who took what they wanted and now they're taking from everybody even their so called own...wake it not the have's and have not it the who cares and cares not...those who have not need deflation because the haves aren't fair...you say tough cookie life isn't fair...the why life isn't what it use to be because employer used to fair...their just a bunch of egotistical sons of...

November 23 2010 at 3:50 PM Report abuse -2 rate up rate down Reply
1 reply to tazgadon's comment
dbgalaxy

Once again...so tired of hearing the whining about everything being "unfair," the haves are "unfair." They need to take care of the have nots. They're greedy, they're evil, waaaaaah. Employers have ALWAYS been that way. Nothing has changed. In fact, the worst offenders are the people whose foundations are now preaching socialism; the people that made workers demand unions in the first place. Now they control the unions. People like Ford, J.P. Morgan, the Rockefellers. All these people and their progeny pump money into liberal coffers to keep the sheeple whining and dependant on the govt. Keep America on Welfare so no one else can get as rich as they are and challenge them. Anyone notice how all these "liberals" have already gotten filthy rotten stinking rich? They've got theirs, but the sheeple still swallow it when they say, "I'm for the working man...tax the rich." They ARE the rich, and they have good lawyers and accountants to make sure that come tax time, they pay nothing. John Kerry even tried to pull a fast one in MA by parking his yacht in RI to avoid paying MA state taxes on it. Shyster. Our system worked like a charm until the liberals got involved. EVERYone had the opportunity for the American Dream. Well, guess what? The American Dream has NOTHING to do with Welfare, handouts, big govt, or being taxed to death. Time to re-think things, libs. Vote out liberals, shrink big govt, ship all the illegals back to wherever they came from so your tax dollars go for YOU, and let the free market work for everyone like it used to.

November 24 2010 at 2:44 PM Report abuse +1 rate up rate down Reply
ruthsgardens

History is a good teacher.America is a young country.We can look at other countries and see the mistakes they made.The problem is we don't.Right now everyone of us has a puter in front of them.How many of you research for facts? And no I am not talking about those consumed with party hatred who search for facts to throw up in other peoples faces either.A lot of things have changed in america and our government since I was a little girl during the great depression.War debt is a killer of many nations.A growing government is another.When almost all countries get to this point they lean towards socialism.If allowed to continue, you end up the a broke government ruled by the rich or a dictator.And their people become indentured servants.To keep that from happening,what must we do?The first thing is to be truthful about what happened.If we were to get rid of social security,medicare,medicaid,va benefits and welfare right now,what would happen?These are the 5 committees we pay into and recieve back from.What would happen?Or a better question should be what did happen?As soon as these committees were created our government borrowed from them.Why?To pay off war debt? No.To balance the budget?No.To spend?Yes.Congress has a field day with new taxes.Congress has grown our government 3,865% since 1918.All taxes to pay off war debts were consumed by our government and not one penny paid towards the debt.The income tax was created to pay off war debt.1/5th of americans wages.Only to be consumed by the government.Congress has been living high off the hog.In other words the best cuts off meat.While our government has become a pay as you go government.When a new president gets elected,he gets a paper signed by 143 countries threatening a boycott if the president allows legislation to be passed saying buy american.Why?Because they know that this is americas demise.And that in order to fix it, america has to change the trade agreements.That would mean our economy would straighten out but they would lose money.Kind of like having a leech on your carotid artery saying if you remove me,you will bleed to death.Obama already said he will not touch trade agreements.He better or there will be no jobs in america to lose.

November 23 2010 at 3:48 PM Report abuse +5 rate up rate down Reply
2 replies to ruthsgardens's comment
carolyntapp

Ruthsgardens I agree with you. I tried to give you a thumbs up. It said I voted but there was no result shown. Funny I could rate another comment down. Regardless it is a very interesting comment.

November 23 2010 at 9:15 PM Report abuse rate up rate down Reply
dbgalaxy

Agreed Ruth. Not just the trade agreements, either. They need to get rid of foreign aid, too. Where does it say the govt can use MY tax dollars to prop up some dictator or other govt overseas? That is not one of the Federal Govt's responsibilities according to the Constitution. Tied to that is the fact that our liberal govt, which includes W and Slick Willy, has used the tax code to force jobs overseas. They've not only given tax breaks to companies that do it, they've taxed the daylights out of the ones that don't. They're making it harder for companies to succeed in the US. They're applying their socialist agenda on a global scale by propping up the third world at the expense of the USofA. All the whiners want to blame the "evil corporations" while the true villains hide and preach "social justice." As Americans, we are more than willing to give of ourselves to help others, but it is not the govt's decision to make for us. Imagine what we could accomplish if we stayed out of other countries' politics (everyone wouldn't be so down on US), we locked down our borders (Americans would be safe, not feel threatened), our govt didn't tax us blind (we'd have money to give to others and spend to boost the economy), and we had a govt that spent within its means (no 13 trillion dollar debt making us beholden to countries like China). Life would be simple and happy, and We The People could concentrate on what we could do to help the rest of the world (not like the UN claims to do by regulating world resources or forcing developed countries to pay "climate change" damages to 3rd world countries for something they can't even prove). We could do all kinds of great things instead of scrambling around trying to pay bills and looking over our shoulder because we're worried about being robbed. A good US economy is good for all.

November 24 2010 at 3:05 PM Report abuse +1 rate up rate down Reply
tazgadon

If people who pay taxes can't understand a monetary system then maybe the system is too complex, maybe its why the mortgage problem occurred, ignorance is no excuse for the law all this bs this puts out for us to chew is sickening, a system that put the rich and money before humanity and common sense deserves to fail.

November 23 2010 at 2:56 PM Report abuse rate up rate down Reply
2 replies to tazgadon's comment
Helen Saghy

The true base of the problem during the boom was little regulation of those who lend the money, and over regulation on those that simply bring the deals to the table. For instance, real estate agents and appraisers have to be licensed, and are likely someo of the most over regulated (rules, laws, etc) people in the country. However, during the boom? People who originated loans did not have to have a license. Realtors and Appraisers did lend the money to people who, after introductory rates, would not be able to afford their homes. One simple document showing how the rates could change, and the mortgage affect, would have helped. I sold and appraised all during the boom, and many lenders had silver tongues. "Oh, don't worry about that. This is how things are done now. Our economy has changed permanently." A document that showed a rate effect on a payment, over several scenarios, would have likely given alot of people time for pause. We could honestly help ourselves if we let the banks fail (they would find solutions real quick) and then only buy and manufacture American products. We have the solution, we just need to use it. We aren't too complex. We have become to reliant on others and way too trusting of the lending industry. We need to teach caution again, as well as documenting what you say. Too many loans were made of the lender's chrisma rather than the borrower's ability to pay over time and changing rates.

November 23 2010 at 3:56 PM Report abuse +1 rate up rate down Reply
Helen Saghy

Excuse me, Real Estate Agents and Appraisers DID NOT lend the money. Typo, sorry.

November 23 2010 at 3:57 PM Report abuse rate up rate down Reply
tazgadon

Companies should'nt be in business if they can't pay their employee's a fair wage...they're paying themselves way too much. What if all the employees walked of the job....How would they make their money from the git go?

November 23 2010 at 2:53 PM Report abuse -1 rate up rate down Reply
1 reply to tazgadon's comment
pcoladude12

Right b/c the average of 3% gross margin is paying themselves way too much.... Get real, and understand Corporate Finance before you post again.

November 23 2010 at 3:11 PM Report abuse rate up rate down Reply
tazgadon

If companies can't afford to pay their workers a living wage they don't deserve to be in business...they're paying themselves way too much.

November 23 2010 at 2:51 PM Report abuse rate up rate down Reply
tazgadon

Many of today's rich don't earn anything...they use laborers and pay them nothing to make their products and deliver their services...their thieves.

November 23 2010 at 2:50 PM Report abuse +1 rate up rate down Reply
tazgadon

dbgalaxy most of the rich in this country don't earn anything they make their money by stealing labor.

November 23 2010 at 2:40 PM Report abuse +1 rate up rate down Reply
1 reply to tazgadon's comment
dbgalaxy

WRONG. There is no such thing as stealing labor. Do you think I'm going to give you 10 bucks if you'll settle for 5? Would you go to McDonald's and pay 13 bucks for a value meal that you know only costs 6? It's all part of the cost of doing business: get the cheapest part, material, or person to get the job done. NO ONE "steals" labor. If the job you're doing isn't worth the money you're making, quit. Find another one. If anyone is stealing, it is the unions. UAW workers make 70/hr for sweeping floors, get benefits up the wazoo, and still piss and moan. Then everyone runs around saying, "Why can't the USA can't make a competetive car?" The Toyota factory in Kentucky is non-union and pays about half of what the unions get for their workers. Their workers are happier and more productive. That would make it sound like Toyota is stealing labor, no? The reality is, these people know what they're worth and they're getting paid for it without having to answer to the unions. Oh, and by the way, by paying only 6 bucks instead of 13 for that value meal, you just earned 7 bucks for doing nothing because you were smart enough not to pay 13. That's what made the rich in this country. That's the same nothing they do hundreds of times a day.

December 03 2010 at 5:53 PM Report abuse rate up rate down Reply
ruthsgardens

Gary is right about one thing.During the great depression I was little.There was big time deflation.25% of working americans were farmers back then.The industrial revolution was in full bloom.The railroads were laying track across america.The industrial giants now had the tool necessary to move.The farmers had already lead the way by wagon to set up small communities.People flocked to these small towns looking for work.Many learned trades and brought trades with them.The bartering system was a mainstay for them until the banks began to expand.In the beginning the banks were good for america.The steel mills came from the east and set up shop in northern Illinois and Indiana.And big cities popped up along the way like Pittsburgh,Gary, and Chicago.Farmers began to produce more because the prices were so low.Where once they had to make a 3 day to 3 week journey to smaller markets with a great loss of product along the way, were given a choice.The railroad.It would cost them more to ship by rail.But it would be faster with a loss of less food.The farmers had no choice but to produce a higher yield as the markets had moved to the larger cities.Yet the prices were still low.As the supply was greater than the demand.At this time it was very true that america could have fed the world.Getting it there was the problem.A dual problem arose.It began with WW1.Americans were called upon and they answered.Farmers expanded and produced for the war.The steel mills were called upon to create ammunition.Americans were making slave wages during that time.American workers had already began unionizing the railroad and was unionizing the steel mills,coal mines and oil industries there to.That wasn't the problem.The union workers finally had a little money to save,invest and buy a house and send for their families.The farmers were finally able to make some money.They invested in their own companies and others.The owners all prospered and expanded and manufacturing plants sprung up everywhere making everything.But the call to war sent many workers over there to never return.Blacks and mexicans were brought from the south to fill the labor ranks of these mills.And america prospered and became powerful.But then the war ended.That was the first problem.Now the farmers had such a high yield but not enough markets.The future world trade markets was just beginning.Then came the great depression.That was the second problem.The banks had been loaning at astounding rates.But those americans died overseas.Their wives and children were left with no income and a house they couldn't pay off.To get control of food prices,Roosevelt began subsidizing farmers to not grow.And it worked.But he never stopped the subsidizing and no president has either even until this day.Most farmers could not compete with the rich farmers or afford the high cost of equipment to do so either.The poorer farmers moved to the cities looking for work.While the rich farmers still lobby congress to keep the subsidies going.Gee, I wonder why?But now instead of exporting food, we import most of it.The same with oil,steel etc.Now after corporate america has been destroying our middleclass,only 12% of working americans are union.Corporate america has reduced wages and cut hours below fourty hours so they won't have to pay insurance benefits and pensions.They move our jobs overseas utilizing cheap labor to build products and sell them right back to americans.And blame americans for them doing it.And the shame is some americans believe them.Our war debt has only been paid off once in history by Andrew Jackson.It has never been included in our budget until Obama.Since 1918 our government has grown itself 3,865%.Many taxes have been created to pay off the war debt but not one penny ever went towards it.It was always consumed by the government growing bigger.Our Income Tax was created to pay off the war debt.But our government used it to pay their incomes instead.Stop subsidizing rich farmers to not grow.Allow americans to go back to farming.Any excess can be sold back to the 78 countries paying off our debt because they need food.Return america back to americans.

November 23 2010 at 2:34 PM Report abuse +4 rate up rate down Reply
Steven

Too bad they couldn't find a way to deflate the price of gasoline. For many deflated wages are here and probably won't leave anytime soon.

November 23 2010 at 2:21 PM Report abuse rate up rate down Reply
1 reply to Steven's comment
kmplx

expect gas to rise. expecty food to rise too.

November 23 2010 at 2:31 PM Report abuse +1 rate up rate down Reply