4 ms·
Consider what happens with significant deflation going on, say 3%. t is then impossible for real interest rates to be less than 3%. Then purchases get pushed in
by MaysonL 12y ago
Consider what happens with significant deflation going on, say 3%. t is then impossible for real interest rates to be less than 3%. Then purchases get pushed into the future, and the economy grinds to a lower equilibrium, with lots of unemployment. Sound familiar?