[econjack]

Negative rates in the CPI does not mean recession or depression. Indeed, we often see negative rates as an encouraging sign when coming out of an inflationary period. Negative rates of 2% are often a goal of the Fed, especially when M2 measures are examined.

[Miami Rebel]

I defer to you, but I’d appreciate you sharing with me a time when negative rates were a Fed goal. I know that the Bernanke Fed adopted 2% CPI growth as its target in 2012.

“We often see negative rates as an encouraging sign when coming out of an inflationary period.”

When?

I understand that a recessionary capitulation can mark the beginning of a recovery, but the only time in living memory that CPI declined for a calendar year was in 2009 following the financial collapse, and even then it dropped by only .04%.

In 1982, with the Volker-engineered collapse of inflation the rate still remained positive, although by only .31%. The next year saw a rebound to 3.2%.