Can the cost of living decrease?

[eRayP]

Obama believes that the US is too powerful and rich comparative to the rest of the world and wants to decrease our footprint in the world. By printing money not only is Obama going to cause inflation Obama is also practicing competitive devaluation of the dollar.

Competitive devaluation of the dollar is reducing the value of our money in comparison to other countries. Our country is too rich for Obama's taste.

[Wartrace]

I think we are on the cusp f a deflationary depression and that is why the federal reserve is pumping out money. It is an effort to prevent this.

If you look back over the past thirty years debt has increased exponentially from the 1970's. This false wealth pumped up our economy and caused steady inflation. Look at "housing values" right now- they bear no relationship to true household income and the ONLY reason they have not adjusted back to where they SHOULD be is the federal reserve's ZIRP (zero interest rate policy).

Facts;
1) Median household income has been declining for the past ten years.
2) THE FEDERAL GOVERNMENT has been papering over the true economic conditions by borrowing 8 to 12% of GDP every year for the past four years and 4 to 8% since 2000.
3) Once this borrowing is forced to stop we will have our depression.

[eRayP]

Originally Posted by Wartrace

3) Once this borrowing is forced to stop we will have our depression.

Very possible. And wait until no one wants to lend the US money or when interest rates increase. The interest we pay on our debt is going to kill our economy. Good ole liberal policies

[BMORE]

Originally Posted by Wartrace

I think we are on the cusp f a deflationary depression and that is why the federal reserve is pumping out money. It is an effort to prevent this.

If you look back over the past thirty years debt has increased exponentially from the 1970's. This false wealth pumped up our economy and caused steady inflation. Look at "housing values" right now- they bear no relationship to true household income and the ONLY reason they have not adjusted back to where they SHOULD be is the federal reserve's ZIRP (zero interest rate policy).

Facts;
1) Median household income has been declining for the past ten years.
2) THE FEDERAL GOVERNMENT has been papering over the true economic conditions by borrowing 8 to 12% of GDP every year for the past four years and 4 to 8% since 2000.
3) Once this borrowing is forced to stop we will have our depression.

I can believe that, I was just talking to a friend about that two days ago. If our creditors lose complete hope in us and stop buying T-Bonds, then we'll be forced to live within our budget; or in other words $2.9 trillion in revenues, $3 trillion in expenses. Or even worse, default.

Originally Posted by eRayP

Very possible. And wait until no one wants to lend the US money or when interest rates increase. The interest we pay on our debt is going to kill our economy. Good ole liberal policies

When I finally agree with you on something, you shift the blame to us liberals. If you were President or even Speaker of the House, what type of spending and cutting would you do the first budget you're entitled to create? And I'm talking about if you assumed office in 2009, when the recession was beginning. Remember Obama wasn't the one who created the first trillion dollar deficit in the budget, it was Bush.

[nononsenseguy]

Originally Posted by BMOREBOY

Interest rates on what specifically? Treasury bonds? Homes? What?



I'm not trying to make this into a political fiasco because the cost of living has increased every year. Its well documented on this site that I'm not worried about my taxes going up, I'm willing to pay more if its used correctly, I just don't want us to go back into a recession.

When did we come out of recession?

Whenever the government takes money out of the private sector (taxation) the economy is the loser. Money left in the private sector grows the economy.

Redistributive tax policy is destructive on many levels. At the very least, it is wasteful, and it removes money from the private sector that would otherwise be available to grow business.

Money left in the private sector and iinvested in business funds research and developement, which results in new products, improved products, new technology, etc. which means more jobs, and even new businesses altogether (spin-offs). Money left in the private sector causes an ever expanding economy. Over taxation will shrink an economy, or at least slow growth considerably.

Why is this so hard for liberals to understand?

Originally Posted by BMOREBOY

But speaking of money printing, I can believe that the more currency is in circulation the less its worth meaning goods, services, homes, etc will cost more. So how do we reduce the amount of currency in circulation and why do we continue to increase the amount in circulation? I feel repetitive asking this question because I asked it the other day, but didn't get a response from anyone.

The problem is that the money government has been printing represents nothing. It has been created out of thin air. It has no real value whatsoever.

For money to be worth something, it needs to represent something of real value (gold, silver). Money that represents nothing is worthless.

Originally Posted by BMOREBOY

I'm not sure if you're responding to me or not, but I'll reiterate that I don't care if my taxes increase by a few percent. I understand taxes are an expense, but how is that connected to my rent increasing? Or food becoming more expensive when production is so high? I haven't been in the workforce for many years (I'm 21 years old), so my taxes have remained consistent over the years yet goods, and services cost have continued to increase. So I don't see the correlation between tax-increases=higher cost of living.

If your landlord is being forced to pay higher taxes, he will have to raise your rent.

Higher business taxes (and they are about to skyrocket because of Obama) means higher cost of doing business, which means in order to maintain the needed profit margin the price you pay for the products you buy must increase (there is your higher cost of living). But the taxes aren't the only factor driving inflation (see below).

Food production may be high, but the cost to produce is going up. We are using food for fuel (which is ridiculous), therefore the price of corn has increased dramatically resulting in higher prices for corn products (corn tortillas, corn oil, corn flakes, corn meal, anything from corn), and corn fed chicken (which also means eggs), corn fed pork, beef (and milk and dairy products), and all those foods that come from the farm.

Also, the ever increasing regulations that businesses have to comply with increases their costs. The consumer is ultimately who pays for those regulations in higher product costs.

The greatest factor contributing to inflation are the costs imposed by government.

[Hot_Handz]

Originally Posted by BMOREBOY

When I finally agree with you on something, you shift the blame to us liberals. If you were President or even Speaker of the House, what type of spending and cutting would you do the first budget you're entitled to create? And I'm talking about if you assumed office in 2009, when the recession was beginning. Remember Obama wasn't the one who created the first trillion dollar deficit in the budget, it was Bush.

It's definitely a bipartisan issue....the fact is conservatives love spending as much as liberals just in other places.