*Yayy for deflation* Thanks Jim, keep my profits rolling in! Tell everyone deflation is bad! The Fed should keep printing. I love it.
What is happening is that we are using the same word, deflation, to describe two separate effects.
One, the one you rightly worry about, is a collapsing economy type, monetary disruption deflation based on things going wrong, market clearing costs, and depression.
The other, the one which is really going on, is improved ways of doing things. This is good deflation which can go on, year in, year out, forever and long may it continue. It is spectacular in direct purchasing of a communications tool, but even in something much more prosaic such as growing corn as high as an elephant's eye, the cost can be falling due to the cost of the tractor being cheaper because the designer uses a computer instead of a slide rule.
Few people can tell the difference. So they worry and print. The USA remains a huge debtor nation. It'll end in tears one day. After I have left town with my profits.
Life's a giggle,
AND isn't it a nice day.
Two meanings for one word - always bound to cause much confusion and fun. Especially when the two are close together and in an abstract area.
Mqurice |
