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It's arguably been going on ( with interruptions ) since 1992. There are only like two years with CPI greater than 5% in the U.S. since then. Of course, it's u
by ArkyBeagle 12y ago
It's arguably been going on ( with interruptions ) since 1992. There are only like two years with CPI greater than 5% in the U.S. since then.
Of course, it's unevenly distributed - medical care, education and housing have all gone up.
I don't think we want nor should we celebrate deflation. It makes a culture hidebound, makes (some) things harder on the poor and can destabilize governments.
Income inequality and political polarization both have a basis in deflation, in my view.
There are nations - like Australia - that do not have deflation. It's not inevitable.
- NeutronBoy 12y agoAustralia hasn't had deflation because for the last 20 years we've basically hitched our wagon to China in the form of mining exports. During that time (and particularly the last 5-8 years) the rest of our heavy and manufacturing industry has stagnated or died (our last locally made car manufactures are finishing up production in the next few years). Now that China's boom is slowing, and we have basically no other heavy industry left to fill the gap, deflation is a real possibility.
- ArkyBeagle 12y agoI am sure it will remain to be seen. I am basing what I said on Sumner's writing on the subject ( how's that for an appeal to authority? :) ) He seems to hold that Oz uses something closer to NGDP level targeting in monetary policy. http://www.themoneyillusion.com/?p=12985 http://www.themoneyillusion.com/?p=12985 I am probably missing something.