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Why do Central Banks ‘hate’ Deflation? Let’s explore!

June 5, 2014

Let’s think about the concepts which we call ‘deflation’ and ‘inflation’. Our current global economic model (called Keynesianism) can deal only with ‘inflation’ but not with serious ‘deflation’. Why? Why do our Central Bankers hate an environment where ‘prices’ decline precipitously and continually? Price declines are a boon for savers, retirees, food stamp recipients, minimum wage earners, and people living under poverty. Yet our elite Central Bankers will do whatever is necessary to avoid a trend where ‘deflation’ prevails (where ‘prices’ decline). What are the core reasons for this mentality? What we need to recognize is that all the core concepts of economics are mostly IMAGINARY concepts of our mind (consciousness). The first principle of economics is the concept which we call VALUE. This concept is the foundation of our monetary/economic system and why we have ‘money’ in the first place. Without the subjective concept called VALUE, there would be no need for ‘money’. Money is merely a proxy (substitute) for VALUE…which is created due to our legal concept called PRIVATE PROPERTY.

Economist’s who understand this concept of VALUE (and private property), recognize that VALUES must continue to increase over time if the model called KEYNESIANISM is to survive. Keynesianism is based on the idea that DEBT (and its opposite ‘credit’) must continue to expand if our economy is to remain viable and functional. When the ‘equity’ in our homes (for example) declines below the ‘debt’ level (our mortgage), we end up with an impossible situation for the Keynesian model to overcome. Keynesianism demands credit expansion (more debt) and increasing VALUES over time (continually). If the market creates a ‘deflationary’ trend (which is systemic) then we end up with negative equity and an upside/down situation as home owners. This creates a vicious cycle of additional price declines which then creates financial insolvencies for all our lenders (our banks, et al). Keynesianism can not allow this event to happen (if it is to survive)! Deflation is anathema for our global economic model (called Keynesianism).

Today, we live with a slew of ‘imaginary’ economic concepts (value, cyber currencies, metaphysical prices, imaginary concepts like inflation/dis-inflation/deflation, derivatives, virtual stocks/bonds, a virtual/digital dollar, an imaginary concept called the ‘wealth effect’, phantom derivative contracts, etc., etc.). We live mostly in an imaginary world within our CONSCIOUSNESS (for trading, investing, lending, saving, and growth) which we call…Keynesian economics. The entire model of Keynesianism is based on math, numbers, econometrics, illusion, deception, and emotional pump priming by our unconstitutional Central Bank). Who understands today’s economics? I would suggest FEW! Our entire imaginary system is built mostly upon the subjective emotions of confidence, illusionary currencies, and positive thinking. If the markets happen to turn seriously ‘negative’ and our stock/bond bubbles collapse, then the entire HOUSE OF CARDS comes tumbling DOWN, down, down. Humpty-Dumpty would have a great fall! Once we experience this major negative downturn in our digital global stock markets (it’s coming), the HOUSE OF KEYNESIANISM  is over!

Keynesians view debt/credit and increasing ‘values’ (price inflation) as systemic for prosperity/growth! 

Central Bankers (Draghi, Yellen, Carney, et al) all recognize that they MUST continue to pump-prime the system and continue to create market illusions (like the wealth-effect, zero interest rates, QE, and a continuing increases in the digital DOW, NASDAQ, S & P, etc. ) or the Keynesian game of illusion is over. Keynesianism is based (at the core) on illusion, delusion, imagination, subjectivity, emotion, debt, credit, fractional reserve lending, math, numbers, consumer spending via credit cards, false faith, false confidence, accounting gimmicks, and a continuation of policy manipulations behind the closed doors of our Central Banks. The entire game is a HUGE illusion of our MINDS (IMO). The vast majority of pundits and consumers ASSUME that our monetary system is REAL and material. In reality, however, our entire SYSTEM is mostly based on illusion/ delusion and word games. Few, however, can discern the confusing ‘word’ games which are played by our elite experts and financial pundits.

Even the word ‘paper’ is mostly a false word today (as our money/currency is a ‘digit’ within Cyberspace…not paper). The word ‘printing’ is a false signal to our mind as most money creation is now ‘digitization’ within Cyberspace. There is no ‘printing’ of money as so many pundits espouse daily within our media outlets (Television and the Internet). Ben Bernanke notified the markets in 2008 that he was not ‘printing’ QE dollars (yet few financial pundits discerned what he was espousing). Our new computer technology now allows our Central Bank to increase their virtual/computer account merely by ‘typing’ new digits into their on-line computer account. Few, however, can discern all these ‘false’ and ‘misleading’ word games which our pundits espouse for the masses to digest. Even the concept of QE is very deceptive. What is QE? We call it quantitative easing but, in reality, it is a policy of creating new dollars ‘out of nothing’. We should call this policy ‘official’ counterfeiting of our legal tender unit (the dollar). Our elite administrators, however, would prefer that the masses remain deceived and unaware! Even our elected representatives seem totally unaware!

QE (quantitative easing) should be viewed as ‘official’ counterfeiting! Today, however, there is no ‘printing’ of notes as in the past! Today, we have our Central Bank creating ‘digits’ via the computer (Cyber Money)…behind closed doors! Who can discern what is happening via the policies of our elite administrators?

The best event that could happen IMO is a serious DEFLATIONARY trend for our global markets. This event would EXPOSE all these illusionary concepts which we now think are REAL and meaningful. A serious deflationary event (for a year or more) would help to WAKE-UP the public to all these Keynesian illusions and delusions (word games). Anyway, start to THINK for yourself and see if some of this missive does not reflect your reality. Personally, I sense that the current financial ‘house of cards’ will eventually be exposed for what it is (a huge monetary/financial illusion of our minds). We need to discern the ‘nature’ of our money today to understand what is happening. Our money today is NOT physical or material. So what is it? I would suggest that Cyber Money (todays dollar) is all within our metaphysical IMAGINATION (but displayed within a virtual environment called Cyberspace). Who understands Cyberspace? All the core concepts of economics are now mostly imaginary concepts of our MINDS. Who can discern this philosophy? Start to think on your own! I am:

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