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<p>[QUOTE=&quot;SilverSurfer, post: 822145, member: 21603&quot;]I try to be very careful in my definition of deflation and inflation.&nbsp; For one thing, people make the mistake of thinking the price of goods going up is inflation and the price of goods going down is deflation.&nbsp; But this is wrong.&nbsp; Inflation is the increasing of the money supply.&nbsp; Deflation is the decreasing of the money supply.&nbsp; Prices only reflect what is happening in the current economy.&nbsp; Take this anecdote as a consideration.</p><p><br /></p><p>A man wants to be rich.&nbsp; He finds a magic lamp and a genie pops out and grants him one wish.&nbsp; He wishes he had all the money in the world.&nbsp; Now he&#039;s rich, right?&nbsp; No, he is poor and so is everybody else.&nbsp; The reason is because he now has all the money and nobody can buy or sell anything because of a lack of a currency in which to trade in.&nbsp; So, someone invents a new currency to make a trade.&nbsp; But, the wish is still in effect and the new currency gets transferred to the man who made the wish to have all the money in the world.&nbsp; So, more money is made and this continues until there is so much money that it is ridiculous.&nbsp; If the spell should be broken and all this new money where available, do you think this would be inflationary or deflationary?</p><p><br /></p><p>My point is that the reason people fear deflation is because the unemployment rate is horrid.&nbsp; People don&#039;t have money to buy the things that they need.&nbsp; But it is foolish to think there isn&#039;t a lot of money out there.&nbsp; As a matter of fact, the money supply has more than doubled in just two years.&nbsp; When the genies spell is broken, you bet your a** it is going to be majorly inflationary.&nbsp; So, are you narrow sighted and looking for a quick profit?&nbsp; Or are you future sighted and looking to protect your current investments and wealth?[/QUOTE]</p><p><br /></p>

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