I often hear certain economists and others saying that deflation is bad. By deflation I am referring to falling prices.
Some of the reasons I hear it is bad is that it causes people to hoard money and defer purchases, both of which I think are good things. "Hoarding money" just seems to be a colorful way of saying saving.
As an example, we see falling prices quite often in the tech sector with mobile phones and laptops and whatnot getting less and less expensive every year. Seems like a good thing, no?
Some of the reasons I hear it is bad is that it causes people to hoard money and defer purchases, both of which I think are good things. "Hoarding money" just seems to be a colorful way of saying saving.
As an example, we see falling prices quite often in the tech sector with mobile phones and laptops and whatnot getting less and less expensive every year. Seems like a good thing, no?
via JREF Forum http://forums.randi.org/showthread.php?t=267669&goto=newpost
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