Which is why QE3 will only make matters worse.[/quote]
Well, it will make some things worse. It certainly won’t fix long term structural problems that absolutely need to be addressed. Though, it does stave off a deflationary collapse. Which, uncontrolled, is the sum of all fears for TPTB – because it would be revolutionary.[/quote]
IMHO, deflation would help those who earn wages, while hurting those who own assets. It would reverse a lot of the damage that’s been done by the growing wealth/income gap between labor and capital, which is why I favor it.
I don’t believe in the “deflationary death spiral” myth. Deflation is the means of correcting gross imbalances in the economy, and when it’s unwound, stabilization will occur, and then real, sustainable growth (or a healthy, stable economy…”growth,” which tends to consist mostly asset inflation as of late, isn’t always a good thing) can emerge.
