• Wahots
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    2 hours ago

    China recently deflated and is still having problems. It’s incredibly dangerous because it causes a negative feedback loop. Prices go down -> people wait to get a better price on something -> prices sink further -> people wait longer -> your economy starts stalling out and going into a nosedive.

    Nobody wants to be the chump holding the bag if they buy an apartment for $50k and it drops to $20k in the next five months. :/

    If deflation worked, everyone would be doing it, and we’d still be using half-cent coins just like the family in Little House on the Prairie did. (Which would kinda be awesome, I’d love to pay a half-cent for an orange.)