Re: DOW Up 416.66 : Financial Groups' Correction?

<stuff_stuff@[EMAIL PROTECTED]
> wrote in message 
news:6r5et310nctpubnuongo2b7s211v2p1nv9@[EMAIL PROTECTED]
> On Tue, 11 Mar 2008 16:30:55 -0700 (PDT), orangatang1@[EMAIL PROTECTED]
> wrote:
>
>>yes and hyperinflation is much, much worse than deflation. everybody's
>>pension and savings are wiped out. society breaks down. i'm guessing
>>you've read the post on frugalsquirrels by the guy in argentina. this
>>is his advice -
>
>
> people are fond of saying that, I'm not sure it's true. Investments
> tend to adjust for inflation.

That's correct (I think Jeremy Siegle calculated that the mean of equity 
markets all over the world and over centuries works out to a rather 
consistent 6.75% over inflation) but traditional pensions and savings are 
fixed income. They can be underwater vis a vis inflation.

JG


 But when you owe a mortgage say and
> your pay check is worth less than when you bought it, and you can't
> sell it and get enough to pay  off the old debt - deflation is brutal
> too.