Geographical Area: United States. Time Frame: Next 18 Months.

The money will be everywhere- except in the pockets of the  "working class."  So we are in for an inflationary depression, better load up on lawyers, guns and hard money.

Neither will happen.

Everything will continue on as it is. Little will change.

Everything will be fine.

No currency crisis.

Government will provide another stimulus, and issue $10,000 checks to every American citizen.

People will go buy big screen TVs.

Dow hits 20,000.

Nothing to see here, nothing to see here.

This poll seems like a good contrarian indicator to me

Inflation. In relative terms ($) goods will go up.

Deflation. In absolute terms (Au, Ag) goods will go down.

Edit: I voted inflation.

We have expanded the US $ supply without a corresponding rise in production.

I voted inflation. Why? Because I never hear our creditors panicking over deflation. China would not be freaking out over Bernanke's keystrokes if massive deflation was coming.

Then again I would more precisely pick stagflation as where we will be in 18 months.

inflation of the essentials; deflation of everything else.

Is this a contrary indicator?

a good post on the inf/def debate by Mole

over at

http://evilspeculator.com/?p=10801

(a bit of a circular posting as he in turn quotes Zero Hedge)

virtual dollars vs. physical dollars.  i think virtual dollars

inflate - people will not want them.  physical dollars deflate -

people have been hoarding them and will continue.

There will be flation. Some in and some de. Most delightfully incomes will deflate for most. The transaction economy will deflate which is great for the financial economy which will continue to inflate as central banks around the world will continue to pour money into the financial economy using the excuse that such will inflate the transaction economy. An extravagant lie which would embarass even PT Barnum.

So baring an asteroid strike or cadres of Teabaggers going postal I'm thinking that assorted financial assets are possibly going to have some stuependous inflationary runs.

Is it just me, or have the numbers been lock-step 71%/29% all day. I have to question whether the table is working properly.

Did every single commenter miss the point of this post?  I stopped reading after page one.  Guys: GEOGRAPHIC AREA.

Poll is asking if the US is going to grow geographically of if we're selling Hawaii to the chinese.

http://moneywatch.bnet.com/investing/blog/wise-investing/inflation-myths...

I find it absolutely fascinating that we are two years into this recession and the outcome of inflation or deflation cannot be predicted by any reliable measures... which tells me that the question that should be asked is how far along in this fiasco are we really at this point?

Additionally, I am in both the inflation and deflation camp...

• Inflation on must-have items which are a defined part of a household budget... which will only cause households to feel the impact more acutely especially if wages and jobs continue to erode. 

• Deflation on the items which are not must-have items and are financed by credit... people won't want them or can't acquire them because of lack of funds or credit... so demand will go down... and hence deflation will reign in these areas.

well, let's see.

needs (health, food, shelter, clothing)

wants (electronics,big houses,luxury cars,vacations,toys)

so, i say needs inflate if population increases, and globally it is

but wants shall deflate

then you got to balance them....

needs ie population growth 1-3%??

wants...well, remove easy credit, instill fear of job loss, increase savings, and the impact of the increase in costs of "needs"....well. wants will deflate by (in my opinion) far more than the needs

so net deflation....

Next 18 months--DEFLATION!!!

I guessed inflation, because at some point, the trend will reverse and I think it could happen within 18 months. Also I am somewhat personally positioned for inflation. But I certainly wouldn't rule out a situation like Japan.

I mainly commented to write about political viability. Inflation helps: those with fixed-rate debt; workers, generally, and especially those with fixed-rate debt; those paying fixed annuities (such as pension funds). Deflation helps: savers (such as holders of bonds); those receiving fixed annuities (such as fixed pensions); those who made loans (assuming they are paid back).

Inflation hurts banks as well as debts paid back are paid with cheaper dollars. You could pay your house off with one paycheck. Yes, I know that a loaf of bread will be $500, but banks will be hurt by inflation as well as deflation. 

   Considering that inflation is a rise in the money supply, we have already laid the groundwork.

The answer is "both" or "it depends". Follow where the increased money supply is flowing and there you will find the inflation. Look at the stock market and the oil market for example. You can have inflation and deflation going on at the same time and affecting the same asset. Housing is a great example. We have house price deflation in most areas of the country but the funny money given out by the government ($8000) is inflating the deflating prices. The net result may be deflation, but technically there is inflation at work as well.

Deflation. I see the US dollar strengthening over the next decade as the world realizes that the Yen is overvalued as the capacity of Japan to pay off its debt declines (declining population leads to declining GDP leads to higher debt to GDP ratio). Also the Euro experiment could collapse as socialist politicians from Spain, Greece, Italy, and etc.will look to regain control of their own currency leading to new currencies pegged to the US dollar. Once the dollar gets very strong, the Fed will really start the printing press in order to pay off all external debt owned by China and the middle East. With a strengthening US dollar investments and new immigrants will flow to the US, increasing RE prices and leading to a new and stable economic expansion in North America. The US and Goldman always win...That is my answer to all the dollar haters

Let's ask Mish about that. I can hardly wait to buy 5-6 houses for $20.(for all of them) So the $ like every other fiat currency, will die becouse in this particular case will become too strong? Wow!

Anyone who thinks we're heading for inflation in the next 18 months is living on another planet.

Also, specifically, why is deflation so bad for an economy?

Two things: The recent phony rise in the stock market is not evidence of inflation and, unless the Fed is truly suicidal, it won't let the the USD crash. Since the USD is still the world's reserve currency, at least for the time being, it is the wild card to be played at the right opportunity. Ultimately, deflation is preferable to a hyperinflationary crash of the dollar. If we lose the dollar we lose everything. Sigmund

And what IF Benny and his Buddys navigate the knife edge edge and we have niether? - all the while teetering one way and then the other. Then the laughs on every kno-it-all and told-you-so. It's the least supported idea, also the dullest and therefore interesting.

Abel Abelson, recounting in Barron’s today "the continuing lack of evidence" that the economy is about to take wing, contrary to the hyper mood of investors, cites yet another vote for deflation.  Writes Abelson:

“Employing his usual restrained prose, Societe Generale’s Albert Edwards articulates some of these misgivings in his latest weekly screed: ‘It’s almost as if the biggest credit bubble in history never occurred.  Investors are increasingly convinced that a sustainable global recovery is emerging out of the wreckage.  All praise to the central bankers for saving the world!  I’m waiting till someone writes about the return of the Great Moderation and suggests Ben Bernanke is the new Maestro.  Then I’ll know the lunatics have taken over the madhouse…yet again.’

“Take a look, he says, at the ever-shrinking rate of bank lending to the private sector around the world, which ‘makes it as clear as the nose on my face that the global economy is still very, very sick.’  And Albert’s nose, from all reports is definitely visible.  The problem, he contends, is that the deleveraging that invariably follows a boom gone bust is starting to unfold in earnest.

“Contrary to the prevailing view that the oodles of stimulus that has so thoroughly soaked economies worldwide will lead ineluctably to inflation, he’s adamantly convinced deflation is lurking around the corner, poised to pounce next year.  He cites the Baltic Freight Commodity Index, now languishing 40% below its June high, as a telltale sign of lagging global demand and an ominous portent of the gathering trend.”

the inflation vs. deflation debate is the wrong question. they can happen at the same time to different asset classes.

nominal values can rise while real purchasing power decreases. nominal values can also drop while real purchasing power decreases.

The good thing about deflation is it crushes gold amd leaves our Chinese overlords holding the bag. Then we default on the debt. Opps, I'm sorry there is no good way out of this mess.

I trademarked it last week on some forgotten comment here on ZH "Hyperstagdeinflation" (TM) I think near term deflation, long term hyperinflation and currency crisis. As with everything though, timing is key. And mine is horrid, I completely bailed on all equity positions in Feb 09 for example. So don't listen to me.

Here's what I believe will happen, for what it's worth.

I voted for deflation, becuse in the next 18 months, that will be what sinks us further into the abyss.

The sheeple are not spending.  The banks are cutting their credit.  Plus there are the people that are deciding not to spend, and are deciding to not use the credit that they have.  They are paying in cash, or not purchasing very many "discretionary" items at all, choosing to buy only essentials.

Housing just flat out sucks.  Foreclosures are going to continue to kill us and bring housing prices down, down, down.  People who had counted on using their houses as a factor in their retirement are waking up to the fact that a house isn't an investment anymore, it's simply a place to live.  People who are waking up to that fact...refer to point number one.  They aren't going to spend money.  They have to save their money to retire on.  Many of these people are the ones that the economists refer to as having "cash on the sidelines", eagerly anticipating a return to the stock market.  I think the economists are wrong.  These people are holding on to their money for dear life, because they have lost trust in practically everyone and everyone.

You won't see these people posting here.  You won't see them protesting in front of their Town Hall.  You won't even hear them saying things that go against the government.  But they cast a silent shadow with their personal habits related to how and when they spend (and invest) their money).  They are speaking loudly and clearly.  They don't trust the reforms.

I believe there will be massive deflation in the things that we own. 

There will be inflation in the things we need to survive...mainly energy related items that we have to import.

The dollar, which is a fiat currency and is not pegged to anything, will be toast.  Stick a fork in it, it's done.

I have often stated to my family that the economy seems somewhat pegged to someone who is manic-depressive.  If it is in it's manic phase, it keeps going up and up, no matter what bad news it hears...If it's in freefall, nothing rescues it, it just keeps tanking, no matter what.

These are humans with herd instincts who are doing the buying and selling.  It does us good to remember that.

Does that include increased taxes, if so, yes to inflation.

If it excludes taxes, then deflation.

http://www.youtube.com/watch?v=JSuR2IgnimA

which ever one is occuring in that video.

Looks like deflation to me.

I read the question as would the geographical area of the US inflate or deflate over the next 18 months. I think deflating area is more likely than inflating area.