I was at work today and my boss and I were talking about inflation and deflation. It eventually got around to the point where he said “deflation CAN be a very bad thing. For instance back in (forgot the year) deflation occurred and the value of my house dropped.” I replied, yes, but your money incre…

lol, deflation certainly can be a very bad thing for certain interest groups - i.e. homeowners. It also could be bad if the government decides, much like if they decided to inflate the currency, to deflate it - but you can basically bank on that never happening. Steady, small amount of deflation f…

Basically, inflation is good for debtors and deflation is good for savers. Inflation encourages spending now, and deflation encourages spending later. Deflation causes credit to tighten, so yeah… It would cause his house to be less valuable than in an inflationary environment, because houses tend t…

Deflation is natural. As an economy grows, it will produce more goods. This means, with sound monetary policy, there will be the same amount of money chasing a larger amount of goods, thus, driving down prices. However, few lay people would see this as a problem. For this reason I’m guessing he was …

Let’s not kid ourselves. The result of deflation will not be benign and will produce extreme results. While deflation may be a necessity to cure past excesses, the process itself will result in devastation. That is a guarantee. Because of the extremely leveraged position of our financial institution…

monetary deflation question

Economics Economics Questions

John_James January 7, 2012, 3:11pm 5

See here.

(especially the two PDFs at the bottom.)

Topic		Replies	Views
Deflation problem Economics Questions	6	1380	September 17, 2012
Monetary Deflation: Really That Bad? Economics Questions deflation	19	4228	December 23, 2011
Deflation and Debt Economics Questions	4	1665	February 25, 2009
Is defaltion bad in our environement Economics Questions	9	1468	July 12, 2009
Deflation arguments. Economics Questions	0	801	December 8, 2010

monetary deflation question

See here.

Related topics

Related on the wiki