The asset - price inflation that seemed to be making the economy richer has turned
into debt deflation, leaving many households strapped to meet their monthly «nut.»
The hearings enabled them to position themselves for this November's elections when the economy will be tanking even deeper
into debt deflation.
Not exact matches
In all these cases the effect of
debt deflation extracting interest is not only on spending — and hence on current prices — but on the economy's long - term ability to produce, by eating
into natural resources and the environment as well as society's manmade capital stock.
Remember what Irving Fisher told us in The
Debt - Deflation Theory of Great Depressions: The public psychology of going into debt for gain passes through several more or less distinct phases: (a) the lure of big prospective dividends or gains in income in the remote future; (b) the hope of selling at a profit, and realizing a capital gain in the immediate future; (c) the vogue of reckless promotions, taking advantage of the habituation of the public to great expectations; (d) the development of downright fraud, imposing on a public which had grown credulous and gulli
Debt -
Deflation Theory of Great Depressions: The public psychology of going
into debt for gain passes through several more or less distinct phases: (a) the lure of big prospective dividends or gains in income in the remote future; (b) the hope of selling at a profit, and realizing a capital gain in the immediate future; (c) the vogue of reckless promotions, taking advantage of the habituation of the public to great expectations; (d) the development of downright fraud, imposing on a public which had grown credulous and gulli
debt for gain passes through several more or less distinct phases: (a) the lure of big prospective dividends or gains in income in the remote future; (b) the hope of selling at a profit, and realizing a capital gain in the immediate future; (c) the vogue of reckless promotions, taking advantage of the habituation of the public to great expectations; (d) the development of downright fraud, imposing on a public which had grown credulous and gullible.
For
deflation to seriously happen, not only the current extreme credit expansion by the central banks and states (through «quantitative easing», stimulus packages, monetising and then spending national
debt etc.) but also the money that was released
into the economy PRIOR to the collapse would have to be «mopped up» again.
As such, we build up productive capacity using
debt, assuming that high compound growth will make it work, and fall
into another bout of
debt deflation.
Firstly,
deflation is only bad in a
debt based fiat system where currency must be continually loaned
into existence or the ponzi collpases.