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A currency cannot be simultaneously deflationary and functional as a means of exchange facilitating commerce. The laws of economics don't bow to your personal p

A currency cannot be simultaneously deflationary and functional as a means of exchange facilitating commerce. The laws of economics don't bow to your personal preference.

sparkie 8y ago
This is simply not true. If deflation is low, it is not a big issue, much like low inflation isn't a major issue. Hyperdeflation causes problems, as does hyperinflation. The arguments against deflation don't really add up. There are numerous examples of deflation working in economies today. Example: Cars which lose 20% of their value upon purchase, and around 10% per year until they're worth scrap metal. If the Keynesian economists are to be believed, then nobody would ever buy a car! If they just held onto the money, it would be worth more than the car will be worth 1 year later. What reason would anyone ever have to invest in a car? For some odd reason, nearly 80 million people do it every year. Computers and Moore's law are another example. Why would anyone buy a computer now when they can just wait 18 months and buy one twice as powerful? People change their spending habits when deflation occurs, moving from high time preference to a lower time preference, but investment doesn't stop. The most savvy investors will take the opportunity to try and increase their assets by productive means, so as to compound the effects of the deflation. If people end up out of bullshit jobs, perhaps they could learn to code or something, instead of begging to state to steal other people's money.
dredmorbius 8y ago
The U.S. dollar was deflationary, excepting the 1812 and Civil Wars, from the 1780s through the 1890s. http://1.bp.blogspot.com/-QFYk6fgnd7c/UOr3hXo3LNI/AAAAAAAAkqc/LaIT4COTAug/s1600/cpi%2Bfrom%2Binception.PNG http://1.bp.blogspot.com/-QFYk6fgnd7c/UOr3hXo3LNI/AAAAAAAAkq...
stale2002 8y ago
Lots of people have used deflationary currencies all through history, actually. Also, your point is irrelevant. If you want to use an inflationary currency, you should totally be free to do so. I merely think that there are lots of other people who would prefer a deflationary one, and would accept both the pros and cons, and that they should be allowed that choice. May the best currency win! If inflationary currencies are so awesome, then you have nothing to worry about ;).

A currency cannot be simultaneously deflationary and functional as a means of exchange facilitating commerce. The laws of economics don't bow to your personal preference.

sparkie 8y ago

This is simply not true. If deflation is low, it is not a big issue, much like low inflation isn't a major issue. Hyperdeflation causes problems, as does hyperinflation. The arguments against deflation don't really add up. There are numerous examples of deflation working in economies today. Example: Cars which lose 20% of their value upon purchase, and around 10% per year until they're worth scrap metal. If the Keynesian economists are to be believed, then nobody would ever buy a car! If they just held onto the money, it would be worth more than the car will be worth 1 year later. What reason would anyone ever have to invest in a car? For some odd reason, nearly 80 million people do it every year. Computers and Moore's law are another example. Why would anyone buy a computer now when they can just wait 18 months and buy one twice as powerful? People change their spending habits when deflation occurs, moving from high time preference to a lower time preference, but investment doesn't stop. The most savvy investors will take the opportunity to try and increase their assets by productive means, so as to compound the effects of the deflation. If people end up out of bullshit jobs, perhaps they could learn to code or something, instead of begging to state to steal other people's money.

dredmorbius 8y ago

The U.S. dollar was deflationary, excepting the 1812 and Civil Wars, from the 1780s through the 1890s. http://1.bp.blogspot.com/-QFYk6fgnd7c/UOr3hXo3LNI/AAAAAAAAkqc/LaIT4COTAug/s1600/cpi%2Bfrom%2Binception.PNG http://1.bp.blogspot.com/-QFYk6fgnd7c/UOr3hXo3LNI/AAAAAAAAkq...

stale2002 8y ago

Lots of people have used deflationary currencies all through history, actually. Also, your point is irrelevant. If you want to use an inflationary currency, you should totally be free to do so. I merely think that there are lots of other people who would prefer a deflationary one, and would accept both the pros and cons, and that they should be allowed that choice. May the best currency win! If inflationary currencies are so awesome, then you have nothing to worry about ;).