Quote:
Originally posted by CET
The dollar hasn't devalued at all. That would require deflation, which only happened for one quarter in 1979. Other then that, the US dollar has never deflated. In the last few years, the Euro has taken on lots of inflation and the US dollar has taken on almost none. You could say there is a comparative devaluing between the two currencies, but there is no real devaluing.
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you are on a verge of a deflation, even though it is not crisis, it is still bad, and the dollar has lost value to most currencies, specially do to the huge national debt
"Federal Reserve Chairman Alan Greenspan sent the Treasury market soaring last week when he hinted that the Fed is worried about deflation. But by some measures, it's already here. Stock prices, for example, have fallen more than 40% the past three years.
The government's producer price index, which measures inflation at the wholesale level, fell an unexpectedly sharp 1.9% in April, mainly because of oil prices. But the core consumer goods segment of the index has been falling for 16 months, says John Lonski, chief economist at Moody's Investor Service. "I don't know where the Fed has been," Lonski says.
Will the USA fall into a deflationary spiral? "There is a very low probability of deflation, but it will be very dangerous if it does happen," says David Wyss, chief economist at Standard & Poor's."
http://www.usatoday.com/money/perfi/...5-invest_x.htm
Note this is from 2003, things are worse now
