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To: aMorePerfectUnion
Hyperinflation is caused by a lack of confidence in the currency.

True.

Deflation is now a far larger threat.

I dont' agree with that, but deflation is not a threat unless it's caused by government action, i.e., the Fed yanking away the cheap credit. Normally occurring deflation is a boon -- it means the currency's purchasing power is increasing.

47 posted on 10/03/2013 8:10:57 AM PDT by BfloGuy (Workers and consumers are, of course, identical.)
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To: BfloGuy

I don’t believe you understand the devastation that will come


48 posted on 10/03/2013 8:26:37 AM PDT by aMorePerfectUnion (I grew up in America. I now live in the United States..)
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To: BfloGuy
Normally occurring deflation is a boon -- it means the currency's purchasing power is increasing.

It also means that every asset decreases in value, the real value of debt increases and commerce slows to a crawl as everyone knows that waiting to buy something means they'll get it for less. Businesses produce less, wages fall, demand falls and prices fall further. It becomes a deflationary spiral to complete collapse. Even Hayek thought deflation was a Very Bad Thing.

64 posted on 10/03/2013 2:46:52 PM PDT by Bubba Ho-Tep ("More weight!"--Giles Corey)
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