Quote: (01-18-2015 08:18 PM)not_dead_yet Wrote:
Can anyone explain to me why I should give a fuck-all about deflation when after 20 years of deflation Japan still has the highest cost of living in the Pacific Rim?
Deflation is much more rapid, insidious and often devastating than inflation could ever be. During an inflation money supply increases, bubbles are created and purchasing power is slowly drained from the avarage middle-class towards the "top".
During deflation prices for commodities and consumer items tend to drop, but it's of no use if you have no job! During deflation it is not the value of the money that diminishes, it is money itself which evaporates!
Deflation is the thing that causes revolutions and makes the heads of "leaders" roll!
We are right at the onset of a catastrophic, historical deflation in Europe (now in 2015!!) which will destroy the eu. core countries and propel living standards into what can only be described as "frozen version of sub-Saharan 3rd world" poverty.
Are your bags packet yet?
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