Financial Crisis: The Philippine Version

[uls]

OUR GOVT?

haha

our govt does not have a plan for this crisis

[Memphis Raines]

^^ actually our government IS the crisis

.

[CVT]

^^ actually our government IS the crisis
.

Agree here bro. I am from the electronics industry and the government has done very little in improving the "ease of doing business" here in our country, in spite, of the many meetings we had with their pointpersons for the industry. Full of broken promises.

deflation is the economic stimulus. dapat talaga mapuwersa magbaba lahat, renta, presyo ng bilihin, presyo ng services, salaries and benefits.

Problem is the government has put all of us in a position where this is nearly impossible. Cost of power and minimum wage are one of the highest tandems in the region. Many years ago, these concerns have been raised with the government. Until now, they are still major concerns....

7202:bruce_lee:

[uls]

deflation is the economic stimulus. dapat talaga mapuwersa magbaba lahat, renta, presyo ng bilihin, presyo ng services, salaries and benefits.

What?!

kung ikaw ang may ari ng inuupahan, mas ok sayo mababa lang ang rental fee mo?

kung ikaw ang may ari ng tindahan, mas ok sayo mababa lang ang presyo ng iyong paninda?

kung ikaw ang provider ng services, mas ok sayo mababa lang ang presyo ng iyong serbisyo?

kung ikaw ay empleyado, mas ok sayo mababa lang ang iyong sweldo at halos walang benefits?

if one has less money coming in (individual or business), one tends to spend less

less spending is not good for the economy

deflation is the economic stimulus?

duh?!

[uls]

far out dude

--

Growth = inflation

Contraction = deflation

[uls]

you said "deflation is the economic stimulus"

my reply is

Growth = inflation

Contraction = deflation

pls explain how deflation stimulates an economy

[uls]

pretty obvious you watched zeitgeist recently

money = debt

then you should understand that all money is created by banks

money is created when someone borrows money from a bank

and every dollar created has interest attached to it

but the interest is not created

the money used to pay the interest comes from the money that was previously created

there isnt enough money out there to pay for all the debt (principal + interest)

so there should always be enough new money created to service the previous amount created

that's inflation

consumers borrow and spend and borrow and spend and borrow and spend...

the job of the central banker is to tweak interest rates so inflation doesnt go out of control

so in short, for an economy to continue to grow, more money has to be created than previous amount created

an economy gets screwed up when less money is created than previous amount created

when less money is created than previous amount created, there won't be enough money to service the previous amount created

when borrowers default on loans, banks' assets go bad (loans are banks' assets), banks tighten lending

less lending, less borrowing, more loans go bad, banks tighten lending even more, even less lending, even less borrowing, even more loans go bad

that's deflation

NOW, explain to me again how deflation = growth

[uls]

it's clear where you're coming from

you are coming from an end user's POV

para sayo, deflation is good coz prices fall

coz inflation to you simply means rising prices

coz all you have in mind are things you wanna buy -- cars, LCD Tvs, laptops etc

you have not taken into account a huge part of what goes on during inflation

when businesses borrow money to expand their facilities and hire more workers coz there's more demand for their products, that's part of inflation

that's bad?

citing your favorite observation: McDo and call centers

Mcdo putting up more outlets in areas where there are call centers...

the more call centers are put up, more McDo outlets are put up

that's bad?

that's part of businesses borrowing and spending. that's part of inflation

so that's bad?

all you are thinking about is what your money can buy.

think about this ---

If you own a house and its market value fell 75% or even 50%, that's good?

that's deflation

If you are a business owner, and your sales tumble coz your customers have lost their jobs coz businesses are laying off workers coz they are downsizing and not borrowing and investing coz there's less demand for their products,

that's good?

your point is deflation is good coz consumers can buy stuff at lower prices

if consumers have little or no money to buy stuff with coz they are losing their jobs or have little access to credit, what's the use of falling prices?

if homeowners see the value of their real estate fall

that's good?

dude, you are not looking at the whole thing

all you are looking at are the prices of Civics and SUVs and LCD Tvs

BTW, there wouldnt be civics or SUVs or LCD Tvs in existence if business didnt borrow money and invested in R&D, putting up manufacturing facilities, hiring people etc...

[uls]

I understand your "deflate everything" concept

but that can only be good when you also have a sizeable reduction in population

and that can't be good

we can cull livestock... like culling millions chicken with bird flu

but people?

[ghosthunter]

I understand your "deflate everything" concept

but that can only be good when you also have a sizeable reduction in population

and that can't be good

we can cull livestock... like culling millions chicken with bird flu

but people?

Well, there are anthrax and ebola for people...