As more economists begin to jump on the deflation bandwagon, one of the world's most prominent investors is betting on inflation. Berkshire Hathaway's Warren Buffet thinks prices will rise -- not fall -- at least in the long-term. The Motley Fool reports:

In the second quarter, Buffett continued to rebalance Berkshire's $34.5 billion fixed-income portfolio toward shorter maturity bonds, which bonds are less sensitive to increasing interest rates. When interest rates go up, which, barring a Japanese "lost decade" scenario, will eventually happen, bond values go down -- but the shorter maturity bonds go down less.

In this case, Buffett isn't ignoring the possibility of short-term deflation, but he must not be counting on a long-term deflation problem like what occurred in Japan.

Read the full story at The Motley Fool.

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