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On 6/5/1933 the USA was also dealing with massive DEFLATION. Deflation is also a very bad thing. In fact periods of deflation correlate with periods of large ec
by specialp 5y ago
On 6/5/1933 the USA was also dealing with massive DEFLATION. Deflation is also a very bad thing. In fact periods of deflation correlate with periods of large economic slowdown. Now I know people who are against fiat currency enjoy deflationary fixed currencies like most cryptocurrencies, but the inability to control money supply leads to hoarding of money, and compounding economic problems due to the lack of money supply.
Hyperinflation is a terrible thing too. But that does not necessarily make gold backed or non fiat currencies superior as large deflation is very destructive as well.
- colinmhayes 5y agoDeflation is much, much worse than the inflation we are currently experiencing. The US was in a 50 year depression starting in 1860 largely due to ineffective monetary policy which caused deflation. Small amounts of inflation are in fact a good thing, as it encourages loaning money.