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Politics : Formerly About Advanced Micro Devices
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To: Tenchusatsu who wrote (501276)8/5/2009 12:20:59 PM
From: combjelly  Read Replies (1) of 1576397
 
"Raise interest rates, raise taxes, control wages and prices ..."

Wage and price controls are often tried, but they aren't really effective. Raising taxes is not nearly as important as controlling the deficit. But, if the politicians don't have the discipline to take anti-inflationary measures when it starts to be a problem there are few choices.

But, again. Taking anti-inflationary measures at a time when there is no inflation and a battered economy is risking a deflationary spiral. If you think high inflation is a problem, just try deflation. Any debt you are carrying, gets magnified. And that pushes more people under water, which makes the problem worse. Round and round as it feeds on itself.
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