by Jeff Bell

Inflation & deflation and their many meanings, should be carefully dissected. Although both have similar meanings, deflation can differ a bit. Deflation can often be found to be the very reason for inflation. The solution for money inflation is the same for deflation. Deflation however often looks for increasing the value of money, but can in turn doing so, cause supply and demand to dwindle.

Inflation and deflation can cause many problems other than just a fall in the economy. It can have devastating effects on people and their means to survive. Sounds serious you might say, well it is. More often than not people find their health failing both emotionally and physically. This occurs from the worry of and inflated economy and what it may mean for a person and their family. Monetary inflation and deflation shows no mercy, and can affect anyone from any …

Japan’s economy, with the possible exception of the UK, is expected to be one of the weakest in the OECD in 2009, and may not recover until well into 2010. The legacy of a decade long debt deflation has left Japan with gross debt that is 175% of GDP, and near 100% on a net basis.

Basically, Japan is powerless to stop the ravages of the global financial and economic crisis because, a) monetary policy is already essentially at zero rates and b) the government is already too heavily indebted to launch aggressive fiscal stimulus.

In 2008, excess savings as well as substantial net selling by foreign investors resulted in continued, large investment outflows of funds from Japan.

Yet the Japanese yen has soared against USD, GBP and virtually all other major trading partners, and currency strategists see further upside in 2009. The major …