8 ms·
I think the world is heading into a deflationary crisis. We're just starting. Corporations seem to think they are immune. Governments cannot do much to stem thi
by dnprock 6y ago
I think the world is heading into a deflationary crisis. We're just starting. Corporations seem to think they are immune. Governments cannot do much to stem this crisis. People should be ready to brace for more shocks. When we reopen, we'd still be in recovery mode for at least a few years.
- woofie11 6y agoUnless we print money. Lots and lots of money. I am counting on that happening, or else on total collapse of everything.
- integrii 6y agoPrinting money defaces the dollar to the world. You can never create value, even by printing money. The system will rebalance because nobody works for free and everything is sold to the top bidder.
- woofie11 6y agoPrinting money does deface the dollar. However, it can destroy or create value, depending on how its done and why. Words like 'never' and 'always' are rarely true in economics. Value is being destroyed through debt defaults, layoffs, and bankruptcies on a massive scale right now. Inflation would almost certainly destroy less value. My expectation is we won't get out of this without either: (1) An economic collapse (2) Cleverness (3) Inflation, to where post-pandemic prices are a small multiple of where they are today (e.g. 2-10x). (4) Mass death and disability (people underestimate the economic impact of having a big portion of the population disabled by COVID19 for the rest of their lives) Inflation seems like among the lesser of the possible evils right now.