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If the crash is inflationary, then yes. If deflationary, then no. Will the future be more inflationary than the market currently expects?
by bigthymer 5y ago
If the crash is inflationary, then yes. If deflationary, then no. Will the future be more inflationary than the market currently expects?
- yossarian1408 5y agoIf your country has a central bank, I promise you the crash is going to be inflationary.
- rory 5y agoI think a more measured stance is that the crash WON'T be (significantly) deflationary. If the crash is "naturally" deflationary, the central banks have now shown a commitment to sustaining inflationary policy to keep inflation at target. But in the case of a "naturally" inflationary recession (stagflation), central banks will be hesitant to ramp up deflationary policy, because regaining employment levels will be a higher priority, and deflationary policy tends to hurt employment.