5 ms·

Well, they've also got horrible growth and debt problems, but I was trying to point to probability of the scenario -- Japan is indeed one of the two cases I was

by jbooth 12y ago

Well, they've also got horrible growth and debt problems, but I was trying to point to probability of the scenario -- Japan is indeed one of the two cases I was thinking of but thanks for correcting me from a decade to ~~20 years (1995 will always be 10 years ago). So out of 700 country-years across the G7, we've got Japan deflationary for 20 with a mediocre-to-lousy economy, and the US deflationary for maybe 5 if we round up, during the great depression. From those datapoints, I'm supposed to conclude that deflationary at 25/700 is the 'natural' state of things, rather than exceptional, and additionally that it's a good place to be?

toomuchtodo 12y ago
> From those datapoints, I'm supposed to conclude that deflationary at 25/700 is the 'natural' state of things, rather than exceptional, and additionally that it's a good place to be? I'm not sure what you're supposed to conclude. It appears, from my rough estimation, that as economies develop (as Japan's did, as the rest of the first world is currently) they'll reach an economic equilibrium which appears to be deflationary in nature. If you continue to become more and more productive, and there are only so many consumers and so much to consume in they physical world, prices should go down.
- jbooth 12y ago
  Well, there's your rough estimation, and there's actual statistics recorded in, for instance, the G7 over the last 100 years[1]. They disagree. Did something change where this is the 'new normal' and I'm just misunderstanding you, or are you claiming all the statistics were recorded wrong? [1]You can use a different basket of countries if you want but changing political situations tend to overshadow the economics everywhere else.
sacado2 12y ago
The G7 is not limited to US & Japan. Why don't you include those other 5 countries when talking about the great depression of the 1930s ? Why don't you include the 2008 and 2014 deflation in most of those countries ? Do so and you'll get close to 100 years. Now why do you limit your vision to 100 years ? Because you know this has been a period when inflation dominated more than ever ? For the bigger picture : http://upload.wikimedia.org/wikipedia/commons/thumb/2/20/US_Historical_Inflation_Ancient.svg/2000px-US_Historical_Inflation_Ancient.svg.png http://upload.wikimedia.org/wikipedia/commons/thumb/2/20/US_... Is inflation the norm, or is the period 1950-2000 an historical aberration ?

by jbooth 12y ago

toomuchtodo 12y ago

> From those datapoints, I'm supposed to conclude that deflationary at 25/700 is the 'natural' state of things, rather than exceptional, and additionally that it's a good place to be? I'm not sure what you're supposed to conclude. It appears, from my rough estimation, that as economies develop (as Japan's did, as the rest of the first world is currently) they'll reach an economic equilibrium which appears to be deflationary in nature. If you continue to become more and more productive, and there are only so many consumers and so much to consume in they physical world, prices should go down.

jbooth 12y ago
Well, there's your rough estimation, and there's actual statistics recorded in, for instance, the G7 over the last 100 years[1]. They disagree. Did something change where this is the 'new normal' and I'm just misunderstanding you, or are you claiming all the statistics were recorded wrong? [1]You can use a different basket of countries if you want but changing political situations tend to overshadow the economics everywhere else.

sacado2 12y ago

The G7 is not limited to US & Japan. Why don't you include those other 5 countries when talking about the great depression of the 1930s ? Why don't you include the 2008 and 2014 deflation in most of those countries ? Do so and you'll get close to 100 years. Now why do you limit your vision to 100 years ? Because you know this has been a period when inflation dominated more than ever ? For the bigger picture : http://upload.wikimedia.org/wikipedia/commons/thumb/2/20/US_Historical_Inflation_Ancient.svg/2000px-US_Historical_Inflation_Ancient.svg.png http://upload.wikimedia.org/wikipedia/commons/thumb/2/20/US_... Is inflation the norm, or is the period 1950-2000 an historical aberration ?