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<p>[QUOTE=&quot;lincolncent, post: 789270, member: 22506&quot;]I agree with your answer. I think the biggest thing to predicting what happens to the economy is what the government decides to do next. If they pass the healthcare plan that could have a HUGE effect on the economy, although its hard to say which direction. If they up and pass another bail out (unlikely but again, this is the government) that would also effect the economy alot. The only reason i&#039;m betting on inflation is because of the amount of money spent on bailouts. A lot of this money was given to the larger companies, and then not tracked as to how it was used. The US spent about 11 trillion dollars in bailouts last year. That&#039;s only 1/5 of our total debt 11 trillion dollars thrown into any economy can cause a very large comotion. Inflation occurs when there is more money in the economy than supply and demand ask for. (excuse my poor economic terminology, i&#039;ve only taken high school econ) If the money supply is greater than the total needed to support the economy, you get inflation. This happens every year (we all know this). Our goal is to try to keep inflation at roughly 1.5-3% each year.&nbsp; A lot of retirement plans have a cost of living adjustment of 1.5% each year to help combat inflation. In my opinion it is not likely that we will see Zimbabwe/Germany-like hyperinflation any time soon, but I&#039;m putting my money on some sort of semi-controlled inflation sometime in the next few years. However, if most of the money for bailouts was actually put in the executives pockets like a lot of people think, we have to worry about deflation. The difference between the 30&#039;s and now is $11,000,000,000,000 worth of gov. intervention. </p><p>_______________________</p><p>&quot;Ask 5 economists a question and you&#039;ll get 5 answers. 6 if one went to Harvard.&quot;[/QUOTE]</p><p><br /></p>

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