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VANCOUVER (Bullion Bulls Canada) -- Since the general public is never exposed to the "virtuous" side of deflation, I will devote a commentary to briefly summarizing the many, powerful economic benefits, which can only be realized when the ("free market") forces of deflation are allowed to operate in our economies. Higher Standard of Living: Contrary to what we are constantly told by the fear-mongers, it is deflation which raises the standard of living for the general public, and inflation which destroys our standard of living. This is nothing but simple arithmetic. The fall in prices of computers and big-screen TV's has literally made us wealthier, as it takes less hours of our labors to pay for these goods today than it used to. If the prices for food and clothing started to fall, we would get wealthier still. Indeed, this is precisely what occurred over a decade ago -- when multinational clothing manufacturers shipped their textile plants to low-wage Asian jurisdictions. The prices for most items of clothing fell significantly, and all of these hypocritical fear-mongers hailed this as a "huge win" for individuals, since it made us wealthier. Contrarians will argue that this manufacturing exodus hurt rather than helped our economies. This isn't true. What hurt our economies was our governments bestowing "free trade" upon multinational corporations before they had begun to make any plans to re-train their workers and begun developing new, high-end sectors to attract capital and create jobs in our own economies. The result was an unnecessary exodus of jobs and capital. In other words, it was not (directly) either "free trade" nor the "deflation," which hit some sectors, that has caused all of the economic harm here. Instead, it was the corrupt and incompetent manner in which our governments served the interests of large (Western-based) multinational corporations, while giving zero thought to the well-being of their own people. We can suddenly see a huge schism in the thoughts and words of these hypocritical fear-mongers. When deflation benefits those at the top it is called "a good thing," but when it benefits the general public it is "the ultimate evil." Add Comment Tweet 1 2 3 Last » Next › var OutbrainPermaLink='http://www.thestreet.com/story/11012356/3-economic-benefits-of-deflation-opinion.html'; var OB_Template = "thestreetcom"; var OB_demoMode = false; var OBITm = "1276003897985"; var OB_langJS ='http://widgets.outbrain.com/lang_en.js'; if ( typeof(OB_Script)!='undefined' ) OutbrainStart(); else { var OB_Script = true; var str = ''; document.write(str); } adsonar_placementId=1341527;adsonar_pid=879768;adsonar_ps=-1;adsonar_zw=600;adsonar_zh=280;adsonar_jv='ads.adsonar.com'; TheStreet Premium Services Compare All Services Jim Cramer's Action Alerts PLUS: Now any level of investor can trade right alongside a Wall Street pro — and enjoy 24/7 access to his portfolio! 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