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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: TRINDY who wrote (128344)10/9/2001 2:26:26 PM
From: Mark Adams  Read Replies (1) of 436258
 
I stand by my statement. I can see why a borrower would want to repay debt in the event of deflation. But the only condition the real interest rate turns negative is when inflation exceeds the nominal rate.

Nominal Rate - Inflation = Real rate

In deflation, the inflation is negative- and a double negative goes positive. FWIW
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