[Wildbill]

Good luck finding alternative views on this Mark, the media gets on one side of the argument and you rarely will hear people talk to economists on their views anyways. The best I hear these days are soundbites from investment bank economists.

The thing is that there are two arguments here Mark. The economy isn't strong and certainly won't get too strong soon. That has its implications, but one of them is most certainly not a sure drop into deflation. That is a big mistake to think. Deflation has to be started by a shock of some sort. You don't fall into deflation unless you make it a foregone economic policy and back it up by your monetary actions. Deflation could come as a result of some very crippling terrorist attacks or something like SARS becoming a bigger problem to the magnitude of 10. Quite simply the world has to stop right now for deflation to have a chance. Do any of the arguments your read point this out? If they think people are going to be slowly brought into deflation they are taking a huge leap of faith. Even if the Fed used all its weapons and took rates down, that is not a sure sign of deflation coming. Deflation takes definitive steps and then a very recessionary run until you truly change the players of an economy into a deflationary mindset. We are in no way near that right now. Lower inflation and slow economic activity are far from deflation. Besides how is it that the economy is so bad when its been 6 quarters since we had a negative economic quarter?

I think this is more of the same media and market bias. Right now its quite clear that the media just don't want to do anything but focus on the bad in the economy. For whatever reason there is on that, you can see it in how you hear a story "oh gosh, we didn't even notice it but hey the market is actually up. Can you believe that?" Now they shouldn't be hyping it up too much, but the tone and the reports are clearly aimed at downplaying anything positive. There isn't a strong balance of positive things out there, but I find the outlook fairly balanced. Clearly its hard to see a 5% spurt, but then again I don't see any sustained periods under 1.5% either. Its very much a middling phase for the economy and I don't see news or expectations reflecting that.

If you really want to get on here and post articles, fine do what you'd like. Just remember every story has its bias and I have seen plenty of negative articles that seemed rather doom and gloom and a handful of positive articles that sounded straight out of the boom 90s. Maybe its that people can't stand the thought of sitting still. A middling run for the economy isn't exciting in either way and maybe people are hoping for definitive answers tomorrow, but that isn't going to happen. In any case I just don't see how deflation has become such a looming threat in what data is out there.