[QUOTE]One year ago, economists were worried about inflation. Now, they are worried about deflation — prices for everything from corn to soybeans to gold are falling. While it might seem like lower prices could be a good thing, unchecked deflation can bring economic activity to a standstill. Economists say the risks of deflation should not be ignored.[/QUOTE]
Deflation certainly is a potential problem....this economy sux. People are hoarding cash, as there is zero confidence in the system. I have no idea how we get out of this spiral..the adjustable rate mortgages from the past 4-5 years are JUST NOW beginning to reset to the higher rates. We will eventually turn, but let this be a cautionary tale for us all- do not live above your means...it's that simple. Hopefully we realize that true happiness is not found in material possessions, & that the best things in life truly are free.
The lesson here if for the Gov and fed primarily.. They should've choked housing prices way before they got this out of hand..
Honestly it's borderline criminal what they did..
Yea, people are irresponsible, but we can't forget that Federal monetary policy is what REALLY caused this whole mess.
Who in their right mind thought this was a good idea without the inevitable and predictable ending, particularly considering real wages have been pretty much flat for most of the country in the last 30 years..