Sentences with phrase «asset deflation»
Asset deflation refers to a situation where the prices of assets, such as houses, stocks, or commodities, decrease over time. This means the value of these assets goes down, making them worth less than before. It can happen due to various reasons, such as economic recessions, market factors, or changes in supply and demand. Full definition
The Fed is trying to rescue the economy from asset deflation, much like 1990 - 1992, but will run into the buzzsaw of price inflation, and tighten a la 1994.
alephblog.com
Hi Eric, I can't speak for Jeff but the inflation that he is talking about is the production of goods and services, where as other people talk about asset deflation.
As Gluskin Sheff chief economist David Rosenberg noted last week, «Even if the recession is over, the historical record shows that downturns induced by asset deflation and credit contraction are different than a garden - variety recession induced by Fed tightening and excessive manufacturing inventories since the former typically induce a secular shift in behavior and attitudes towards debt, asset allocation, savings, discretionary spending and homeownership.
Consequently, the government can sometimes miss signs of impending asset deflation.
I have been arguing for asset deflation and price inflation for some time now, and that is not a mix that I would enjoy trying to manage, if I were on the FOMC.
Continuing asset deflation, and declining but still positive economic growth (as the government measures it) leads the Fed to continue to loosen, or stand pat in the face of rising consumer price inflation.
It's also possible to have goods inflation and asset deflation at the same time; its definitely possible to not save enough as a culture, or to have resources diverted by the government to fight a war.
Congress will have an implied inflationary bias, because the complaints will come more from asset deflation.
Asset deflation is happening all over the world and is about to happen soon in other markets (mine).
We are in a period of asset deflation and consumer price inflation, so this is a difficult period to negotiate through.
We are presently faced with both rising consumer price inflation and asset deflation.
Pretty soon, it will have to decide which pain is greater: goods price inflation, or asset deflation.
Ultimately government programs which support private credit market assets may be required in order to prevent an asset deflation of significant proportions.
The asset deflation is hitting them hard, and lending is contracting.
We are experiencing goods and services price inflation, asset deflation, and a monetary system where the Fed is not increasing the monetary base, but the banks are expanding their liability structures over the last year, but that may have finally peaked.
So, in my opinion, asset deflation will persist, and goods price inflation will increase.