The Five Dumbest Things on Wall Street This Week

1. Take the Money and Ronald

If you want to know if we're in a deflationary economy, don't ask Alan Greenspan. Ask Ronald McDonald.

Yes, we at the Five Dumbest Things Research Lab have lost faith in the value of the usual deflationary indicators out there -- stuff like the producer price index, automobile pricing, the core elements of the consumer price index. Too many numbers. Too much analysis.

Instead, we're paying attention to something a lot simpler and a lot easier to follow: The Happy Meal from McDonald's (MCD).

What, you may ask, could possibly make the Happy Meal a harbinger of a widespread decline in consumer prices?

Maybe, we think, because it's so widespread. How often does an American household buy a refrigerator or car? Not often, right?

But how often do people buy Happy Meals? Judging from recent news stories about the epidemic of obesity among America's youth, more often than you'd want to know.

Anyway, the latest indicator of an alarming deflationary trend showed up in the window of our local McDonald's just this week: a poster advertising two Happy Meal toys per Happy Meal.

A Happy Deal McDonald's plays it toy

Two toys in one Meal! Unprecedented! Unheard of! And scary, if you ask us.

If the only way McDonald's can hold prices steady on a basic commodity such as a Happy Meal -- we're talking about a hamburger, a small bag of french fries, a small soda and a piece of plastic -- is to add another piece of plastic, we're in an awful state.

Of course, this could be a temporary aberration at a few McDonald's "restaurants."

Or it could reflect simply the chain's well-publicized troubles, not a macroeconomic trend. But at the Lab, we never think small. We always supersize it.