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To: expat_panama
The lowflation of being consistently below an already low target is bad in itself;

BS. The natural rate of inflation is slightly negative as people become more efficient and better tools are made. Anything above that is the government and bankers sticking their hand in the till.

A short spell of deflation driven by cheaper oil

More BS. Inflation is a creation of either over production of money or a fixed money supply with a decreasing total production. Supply shocks, neither positive or negative, are not deflationary nor deflationary. They may decrease or increase prices, but that is not inflation. This argument is like saying the drop in price in electronics(compare $500 for my first 32 MB drive to about $60 for my most recent 128 GB flash drive, or an annual deflation rate of 32% not even count increases in speed or convenience) is bad.

Too many economists confuse deflation in a collapsing economy with the natural deflation from productivity increases and think that since the first is bad (although a secondary effect) that the second is also bad.

17 posted on 10/23/2014 11:38:31 AM PDT by KarlInOhio (The IRS: either criminally irresponsible in backup procedures or criminally responsible of coverup.)
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To: KarlInOhio
Supply shocks, neither positive or negative, are not deflationary nor deflationary. They may decrease or increase prices, but that is not inflation...

Sounds we're got different inflation definitions; maybe we'd be get more done if we picked one and went from there.  Here's one that most folks are already using:

inflation (ɪnˈfleɪʃən)

n

(Economics) a progressive increase in the general level of prices brought about by an expansion in demand or the money supply (demand-pull inflation) or by autonomous increases in costs (cost-push inflation). Compare deflation

Collins English Dictionary – Complete and Unabridged © HarperCollins Publishers 1991, 1994, 1998, 2000, 2003


19 posted on 10/23/2014 12:30:45 PM PDT by expat_panama
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