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Nightmare deflation

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Wheylous Posted: Thu, Oct 27 2011 8:31 AM

http://news.yahoo.com/nightmare-scenario-u-deflation-risks-rising-201946557.html

Can someone point me to some articles for "deflation terrible" and the Austrian reply to that?

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Neodoxy replied on Thu, Oct 27 2011 5:32 PM

http://www.youtube.com/watch?v=U9w0S9bEXIw

Most modern economists are amazingly scared of deflation. A little bit of deflation will not do anything inherently other than increase the strength of the dollar. In our day it could cause a little bit of uncertainty and market fluctuation because people are used to inflation and not deflation. I have a suspicion that if there were enough deflation then it would spiral out of control, however. I feel like we might find Mises' flight to real values approached from the other side where everyone hordes money in hopes of its ever increasing value until there was such disruption that people stopped using it as a medium of exchange, I could be incorrect but this is just a quick theory that occurs to me.

At last those coming came and they never looked back With blinding stars in their eyes but all they saw was black...
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