The Doctrine of Inevitability

[Max Sawicky]

Rakesh:
>Oh, on the question at hand, does deflation only benefit bond holders?
>Can't it aid the centralization process as well--driving weaker capitals
>to the wall, allowing better positioned ones to pick them up for a song?

Two quick points:

This sounds plausible.
Deflation associated with slow growth and
low employment obviously benefits employers
in general on the labor cost side.

In all cases, however, these seem to me to
defy 'either/or' imperatives.  Sure, somewhat
more deflation or downward pressure on wages
benefits broad constituencies of capital
owners, but there is no obvious reason why
a little less of this benefit must be a
fundamental problem, particularly compared
to the alternative of collapse.

On military spending, from an economic standpoint,
there would seem to be little apparent difference
between forced 'consumption' in the form of
military spending and government policies in
domestic spending.  If the government can't
force people to spend money by giving them some
(apparently an issue in Japan), it can always
build infrastructure, or even give money to
impoverished nations that are compelled to
import U.S. consumption goods.

Note for anyone who wants to watch the
ticker, try:

http://quote.yahoo.com/q?s=^DJI&d=t

MBS