Inlfation or Deflation

  When all is said and done the answer to the question of whether we are entering a deflationary or inflationary environment is the central one to all subsequent investment decisions.

 Personally, I think we are in a depression, deflationary environment.People point to government creation of trillions of debt and state it must lead to inflation or even hyperinflation. My question, which is not rhetorical, is if say $2 trillion is created, but $15 trillion has already been lost, why would that necessitate inflation?

  I have two problems: the government stats on unemployment are pure fiction and are vastly underestimated. Unfortunately, and in a sense offsetting that fact, their stats on CPI are also complete confabulations, and are also underestimated. So relying on BLS numbers is a complete waste of time, except to get a gauge on the fantasy world the bureaucrats operate in.

  So the question remains:are we about to experience a serious deflationary environment, or a serious inflationary one? I rule out these cretins getting it  right, as they never have...

 

Deflation.

I think China is a boiling pot ready to implode, that will add to the global deflation and will slow our GDP, as will issues in Europe.

That makes it 2-0 deflation...I am very interested in knowing what people here think, so anyone else?

I don't know if we will go to a more deflationary environment than we're already in... but inflation is months, if not years away.

There is just too much slack in the economy (i.e. too many unemployed workers and factories sitting idle) for us to think inflation is around the corner..

Basic economics - deflation first then massive inflation. The dollar is becoming the world's peso thanks to the folks in Washington.