[cuban leaf]

So energy prices should only be allowed to go up?

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That’s not what I’m saying. I love that they are going down. However, if our economy is credit based and dependent on inflation (e.g. it’s fine if your debt goes up at the same percentage as your income goes up).

That means that deflation will cause a reduction in income and taxes, and taxes are the income of the government, which owes a LOT of money. So if debt remains the same or even increases while income declines, the economy just gets worse and worse until it reaches a tipping point.

I don’t know what that tipping point is.

Individually, if you keep your job and your income, you will do well, but when the tipping point comes (and we may already be feeling the first wave of it) social unrest will have an impact on everyone to one degree or another, depending on where you live.

[9YearLurker]

Or, if that causes a slow economy, that means interest rates go or stay down—and that is more central to a country’s ability to repay its debts.