The "deflation is bad" theory is the biggest academic-sponsored fraud in history.Submitted by Apple on Thu, 11/01/2012 - 08:24
The Biggest Academic-Sponsored Fraud in History
Inquiring minds may be wondering "Is deflation really a problem?"
The fact of the matter is deflation is the natural state of affairs is deflation. Productivity improvements over time lead to lower prices. Attempts to prop up prices only benefits those in unions, those holding assets, and government bureaucrats who want to raise taxes.
Deflation is only perceived to be a problem because of the reckless expansion of credit that preceded it.
Look at it this way: If deflation caused a downward spiral in which everyone held off purchases expecting lower prices tomorrow, not a single computer would have been sold since 1990!
Yet, the price of computers, memory cards, wide-screen TVs, and in fact everything technological has been dropping like a rock for ages. Every day such items are bought. That would not be happening if Fed and academic theories regarding the downward spiral of deflation were remotely true.
Moreover, and as noted above, the unseen effect of the Fed's attempt to prop up wages and prices directly led to a loss of jobs to China.
The "deflation is bad" theory is the biggest academic-sponsored fraud in history.