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To: ClearCase_guy

I’m thinking mostly in terms of how the economy went bad. It wasn’t a continuing deflation that wrecked the economy in the 1930’s; the stock market crash in 1929 took people’s imaginary money away first and deflation was the result.

I’m thinking a healthy economy that had no deflation, then deflation that was kinda noticeable, then became something that everybody just accepted as a way of life, and then got worse and worse, and then the economy collapsed.


18 posted on 08/12/2010 10:19:32 AM PDT by jiggyboy (Ten per cent of poll respondents are either lying or insane)
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To: jiggyboy
I’m thinking mostly in terms of how the economy went bad. It wasn’t a continuing deflation that wrecked the economy in the 1930’s; the stock market crash in 1929 took people’s imaginary money away first and deflation was the result.

I suppose I can't think of an instance where a healthy economy was slowly overcome by creeping deflation, to the point where the economy was eventually wrecked. If that's what you're looking for, I doubt you'll find it.

I would say that the US in the 1930's, Japan in the 1990's, the US right now are all examples of some Bubble bursting in a fairly dramatic way (stock market, housing, etc) and then -- because so much value was suddenly gone -- finding that the following years experienced dramatically slower growth because of the onset of deflation. I think that's pretty much the standard model and examples of that can be pointed to (as I have done).

43 posted on 08/12/2010 11:50:19 AM PDT by ClearCase_guy
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