Saturday, September 05, 2009

Despite signs of recovery, some see deflation looming

The L.A. Times reports:
The housing crash and the recession have made this a renter's market. The cost of apartments and homes for rent can only decline. Just look at the number of "for lease" signs in every L.A. neighborhood.

This is deflation in action: falling prices that are, in effect, a transfer of wealth from landlords, goods producers and retailers to consumers.

If you're employed, price deflation can be a boon, of course. What's not to like about spending less?
You'll want to read this one.