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Recent Economic Data Shows the Good Side of Deflation
Submitted by Mises Institute
The Fed, the ECB, and the Bank of England repeatedly tell us that deflation is extremely dangerous for an economy. Central bankers, most economists, and the media speak of deflation as one of the greatest disasters that can strike an economy.
It is stunning then, given the apparent importance of the subject — and the possible collateral damage of pro-inflation policies — that few seem to bother to ask the deeper, fundamental question: does the historical data show that deflation is actually a terrible thing? The data suggests that it is not. In fact, looking at recent GDP, inflation, and employment data, one could even say that a shot of deflation is what many economies need. Let us take a look at the recent real-life examples.
Japan
Japan is the only Western country that has experienced protracted deflation in recent decades. According to those with deflation-phobia, deflation is a disaster in part because it causes households to postpone their spending, leading to falling consumption and high unemployment. Thus, Japan should be a country characterized by high unemployment, everything but a bustling shopping scene, and a much lower standard of living than, say, twenty years ago. Japan should also be absent from every international comparison of economies in terms of innovation. Instead, Japan features at least in the top 5 of every ranking of the most innovative countries in the world, consumption has increased in spite of years of falling prices, the unemployment rate is lower than 4 percent, and Japanese streets are filled with shops selling everything known to man.
Of course, the Japanese experience with deflation might just be an exception to the rule. Luckily, we have data for other economies as well.
Greece
In the eurozone, there are two countries that recently have fallen into deflation. In Greece, prices have been falling since the beginning of 2013. In Spain, the annual inflation rate started to nosedive at the end of the spring 2013 and it fell sharply, to 0 percent, in the autumn of the same year. It has stayed there ever since, dipping below zero in the summer of 2014.
If we take a look at the GDP growth in Greece, we find out that in the first quarter of 2013 it shrunk by a staggering 5.8 percent. In all subsequent quarters of that year, the Greek GDP continued to shrink, but the rate at which it did so decreased. In the first quarter of 2014 the economy lost just 0.4 percent of its size. That was the last quarter the Greek GDP shrank. Since then, economic growth has returned, first at only 0.4 percent, but soon the growth rate rose to almost 2 percent. So the economy started to recover at the same time the prices started to fall.
Spain
In Spain we see the same scenario unfolding. At the end of January of 2015, Spain reported 0.7 percent economic growth in the final quarter of 2014, the highest growth percentage in seven years. When we plot the growth of the Spanish GDP in recent years, we see that the rate of decline started to slow in the first quarter of 2013 and the economy actually started to grow in the third quarter of that year. The Spanish GDP has been growing ever since and the growth rate has been picking up: from 0.2 percent in the third quarter of 2013 to 0.7 percent in the last three months of 2014. As in the case of Greece, one can make the case that the economic recovery coincides with the moment the prices started to fall sharply and the recovery took off when the inflation rate turned negative.
The Netherlands
Further up in the north of the eurozone, in the Netherlands, the inflation rate started its rapid decent in the summer of 2013. The annual rate of inflation fell from more than 3 percent to 1.5 percent in just a couple of months and then some more. In less than a year, the inflation rate dropped from more than 3 percent to almost 0 percent and has been hovering just above that level until recently, when the prices fell even below 0 percent.
When we plot the unemployment rate, consumer confidence and consumer spending in the Netherlands in the same graph as the annual inflation rate, we see the same pattern we have seen in Greece and Spain: almost at the same time the inflation rate tanked, consumer spending started to increase faster (it even increased at the fastest rate in years at one point), the unemployment rate started to fall and the consumer confidence staged a strong recovery. The GDP, which was contracting in every quarter starting with the beginning of 2012, started its ascent in the third quarter of 2013 and has returned to positive territory in the final months of 2013 where it has been ever since.
The Benefits of Falling Prices
Why do these developments contradict what we’ve been hearing from central bankers and economists? First of all, the general inflation rate started to decline mainly due to a fall or a relatively modest increase of food prices, for example. Then, in the last couple of months, the sharp fall in oil prices pushed the energy-category of the inflation basket sharply lower. Food and energy are the two categories people spend a large part of their money on. If they need less money for those things, they can spend more on other goods and services. After years of tax hikes and other assaults on their income, people in various eurozone countries actually started to have more money to spend in real terms. In the Netherlands for example, the fall of inflation had led to something the Dutch had not experienced in years: their wages rose faster than prices. Still, central bankers refuse to acknowledge this and keep going on about the danger of deflation, often referring to the Great Depression.
At the same time, one thing we know for sure about deflation is that it increases the debt burden in real terms. So, one cannot help but wonder whether this insistence on deflation as the reason for quantitative easing in the eurozone has anything to do with the fact that many euro area governments carry a large debt which would become even larger with protracted deflation. Central banks are throwing everything at falling prices, something Joe Average actually needs badly.
Recently I spoke to the legendary former chairman of the Fed, Paul Volcker. According to Volcker “the idea that when people see prices falling they will stop buying those cheaper goods or cheaper food does not make much sense. And aiming for 2 percent inflation every year means that after a decade prices are more than 25 percent higher and the price level doubles every generation. That is not price stability, yet they call it price stability. I just do not understand central banks wanting a little inflation.”
Perhaps the central bankers and economists from all over the world should take a break from the theory and their focus on economic models and instead have a look at the real world and spend some time talking to Volcker in order to remember that deflation is not the disaster they imagine it to be.
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If the world were not debt ridden, deflation would be great. But it is and it is not.
so, the people get to pay for gov't and bank malinvestments? did you get your PhD in economics from Yale or Harvard?
Deflation may be "fair," but it's going to hurt a lot of people. Perhaps they deserve it.
When did Japan relocate to the West?
"Japan is the only Western country that has experienced protracted deflation in recent decades."
Japan is a wholely owned subsidiary of USA Inc. 'Client state' is the term I'm looking for. They may be ready to go all 'Roots' on us though and return to their Eastern ways. We should be grateful, they have carried a lot of water for us over the past 70 years.
So is Germany its in the terms of their surrender from ww2. Literally they are US puppets by international law.
Ah, thanks for the clarification guys - I was thinking maybe it was down to a Fleudian srip
This article os smoke and mirrors:
Can anyone say MONEY SUPPLY?
Japan- Abenomics has caused a vast increase in money supply, even as prices stagnated.
Greece/Eurozone same-same re/ ECB.
If anything the success stories shown above are a vindication on CB policy, as much as I hate to say that.
The idea of "fairness" is based upon perspective. What is "fair" to one party may not be to another.
But the real problem with "fairness" is who decides and how is it determined? If you are a large debtor, "fairness" is inflation. When one can affect this "fairness" with money or political influence, then the idea of “fairness” becomes corruption.
And that is what we have today, crony capitalism and corruption. And that is only “fair” the debtor would say.
sschu
As with most of these things, there are various aspects to inflation and deflation. But one thing is for sure, PEOPLE (NOT models) do NOT spend MORE when they think the price of things is going to go up.In the same way, PEOPLE do NOT spend LESS when they think the price of things is going down.
Academic claptrap.
DavidC
Tell me that when you are living on a fixed income That mostly does not increase till you die.
Deflation is the only breath of fresh air.
It is crippling and deadly without it.
I'm no fan of debt based monetary systems but the simple truth is tptb can't allow deflation in a debt base monetary system period. Particularly one with a credit bubble that has gone on this long. Sure if it were a gold based system deflation would be fine but it's not what we have. Perfectly explained here. Slow in the beginning but well worth the read:
http://debtcrash.report/entry/history-and-introduction
Exactly!
The ONLY reason the central banks keep feeding us this crap about 'deflation is bad' is because it affects those who are indebted the most. The BANKS!
DavidC
Must be quad witching/watch porn/smoke crack Fryday over at Mises...
All the countries mentioned are suffering from deflation in all the wrong places...
That's kind of the fucking problem right now. Globally...
So the folks that thought they would be paying back less in real dollars end up paying back more....
That's called risk.
the imf will be there to assist, with onerous terms I would guess !
That debt can never be paid back. It will default = deflation. So the amount of debt is a moot point. It will suck for those individuals who have too much personal debt, but no one held a gun to their head. Why should those who have been prudent and managed their expenditures to avoid debt, be penalized; while those who did all the wrong things get rewarded?
I'm always wondering, if the entire world is deep in debt, who is owed all the money?
Private Central Banks that issue the credit in the form of Currency.
So it is patriotic to pay more for things every year to assist in the dissolving of the obligations of the debtors...who just happen to be their governments. Prudence is for suckers.
It is still great for those with no debt, fixed incomes and inflation sensitive cost structures. You know, like lots and lots of people.
It's not so great for those with massive amounts of debt used to purchase inflation sensitive assets. You know, like bankers, and Wall Street, and governments, and speculative billionaires.
So fuck them.
Anything that accentuates the ineptitude of central banks and friends is a win win in my book!
Biggest problem with deflation is that the govt can't help itself and as prices slide their own fear causes them to overshoot on the inflationary side later........just look at Volcker for heaven's sake.
yes exactly. what funny is that they use volcker as an example to justify what they are doing. "everything is fine. we will just raise rates like volker did nothing to worry about!" people have no idea how fucked we are
Deflation? in what exactly?
With 7+ billion people on this rock, and growing, there is no such thing as "deflation" in the cost of anything required for a higher standard of living.
Deflation in plastic crap and electronic toys, sure, but so what?
You mean you don't eat iPads?
so oil didn't drop 60%?
For how long? Are you another short-term or long-term player? Priced in what? You really think it's going to stay low at the current global burn rate? LOL!!!
Personally I hope to be arund for a while, but that's just me.
Maybe a few despot nations have some pain, bring it on
In everything. Price = ALl money (including debt) / all goods and services. If the numerator falls due to defaulting debt, then there is deflation. Supply / Demand still applies, but a drop in the total sum of all money sure puts a damper on a lot of demand. Fot those "needs", less money per item means a drop in prices and that is deflation too.
So you are trying to convince me that those 7+ billion people are going to stop competing for a higher quality of life and all the real resources that make that possible?
LMFAO!!!!
Good luck with that. FYI- don't confuse "deflation" with the death of a currency, big difference dumbass.
Insults are always the last resort of a losing argument. Everyone is competing for computers to have an easier life. Why have the prices fallen?
If you can't answer the question that's fine. You give yourself away then. People are not going to simply stop competing for all the very real resources that make a higher standard of living possible. So long as the popoulation is what it is, there will be plenty of demand. Prove me wrong.
What question? you made a statement. People have always competed for real resources. And yet, there have been deflationary times. Don't forget that we are what we produce, not what we consume. You appear to be looking at the consumption side of things (very Keynesian of you).
The higher standard of living will be driven by production of things to enable that standard - which leads to real economic growth, which leads to an increase in the standard of living. Any time production grows from savings and not mystical debt creation out of thin air, leads to an improvement in the standard of living and a benefical side effect of falling prices.
That's all there is to say on that. If you don't understand, then you don't understand. It doesn't change the facts.
You are the one who has made the statement. It is up to you to prove that statement correct. That is how these things work. Otherwise, you're an analog of a global warming alarmist who ignores the null hypothesis.
"And yet, there have been deflationary times. " -- no shit sherlock, and there have been periods of global war where the population decreased. Exactly my point. During those times, demand went down. Thanks for helping, or are you yet another Ph.D. moron that thinks there is no energetic cost to bringing innovation to the market? Good luck with that Ph.D. in eCONomics, leave the development and delivery of products to us engineers wearing the big-boy pants.
As you confirm, there will be no real deflation so long as the population keeps increasing. I don't know "facts" you are looking at but the puchasing power of all fiat keeps getting going down and down and down...
No point to arguing since you just don't understand.
Right, good luck with that dissertation.
You wrote in your previous post...
...but a drop in the total sum of all money sure puts a damper on a lot of demand.
Then you wrote
Everyone is competing for computers to have an easier life.
Computer prices decline due to either lack of demand or an abundance of supply.
If everyone is COMPETING then it is apparent that the demand side of that relation has not declined, isn't it?
This FACT absolutely CONTRADICTS your assertion that a drop in the supply of currency puts a damper on a lot of demand.
Now are you going to be REASONABLE? Or do you wish to continue to spout off your confusion?
"If everyone is COMPETING then it is apparent that the demand side of that relation has not declined, isn't it?"
Agreed.
"This FACT absolutely CONTRADICTS your assertion that a drop in the supply of currency puts a damper on a lot of demand."
Not necessarily. A lot of demand comes from the use of credit as money. If the supply of MONEY declines it usually happens from the credit side. Less credit = less demand. The demand for computers hasn't abated. But the demand for copper has somewhat, as an example, driven by the lack of credit for stockpiling it on margin.
Are you a sock puppet by any chance?
Hmm.. the computer analogy may/may not have been the best to use.
Here's the thing:
Yes, computers were expensive, and yes there was increasing demand...but then... technology made it easier (cheaper) to make...so prices could come down.
AND.. everyone wanting one created more need for more supply, so other people got into the (computer making) game, and healthy competition coupled with newer technology, made them even cheaper.
Thats ONLY possible in a FREE market.
Just pointing out that theres more reasons for price fluctuation than just supply/demand. Technology /Competition /free markets have something to do with it too.
Of course..those days are long gone.
:(
It's not that hard to get an eCONomist to contradict themselves, after all it's only a social science.
“competing for a higher quality of life” what does that mean exactly?
One can compete through warfare, or one can compete by out bidding in the market place….that requires income. If no one has any money, there will be no market place competition. Market place competiton requires rising wages…I don’t see that happening.
"If no one has any money, there will be no market place competition. " -- bullshit. The marketplace those poeple are playing in simply isn't "official".
Get long black markets and sharecropping then. As you point out, people will simply kill your ass and take what they need. That's what war is friend and you admit that "one can compete through warfare", or would you like to retract that statement?
Oh. You're such a tease!
Can "one compete through warfare"? Yes or no?
Compete for what? Death?
Are you really that daft or are you just being a disingenuous cunt? Resources, lots of history on countries conquoring other countries for their resources you stupid fuck.
What has that got to do with the price of goods. The topic is deflation, which is falling prices not due to supply / demand factors.
Stay in your bunker, eat your canned beans, count your ammo. We'll come get you when it's all over.
Death of a currency results in hyperinflation.
Deflation may come first, but it's not death if it's forty years off. Otherwise, I'd be dying right now, too...
Isn't it: Hyperinflation resuts in the death of a currency. And a new one is born from the ashes.
But wait!
Why aren't you also asking the same question for the other leg:
How can inflation be constantly higher than the increase in population plus overall average productivity increase?
And if that is the case, why wouldn't we normally need phases of deflation to adjust for that? (If the CBs didn't evade it by changing the measuring yardstick, that is.)
Where is this popultation growing? Not in the western world, not in China, not in Japan, not in Russia, not in S. Korea. In fact the lack of population growth is a root problem with the economy. India is and that is where I am placing my money after we get a nice Great Equity reset.
And what is the average standard of living in India again?
FAIL! The point being that a lot of energy will be required to simply maintain the status quo for 7+ billion people.
When being raped in the ass. Deflation is a good thing for you.
This fractional reserve debt based system cannot tolerate actual deflation due to the basic underlying ponzi math.
This is why the USD has depreciated by 98 percent in value since 1913.
The debt has to be constantly inflated away. Otherwise, the system folds.
The debt has to be constantly inflated away. Otherwise, the system folds.
Let's say they Print 100$. Loans it to you, at (say) 5% interest.
WHERE does the $5 come from to pay the 105$ back?
You have to BORROW that money(it is printed) and Now that money has to be paid back.
You borrow again, More Money Created, You have to pay back more...
And in 100 years(like you said) Now your money has DEvalued 98%...
Simple scam with GROWTH builtin as a pre-Req.
one can only inflate so long until the faith is lost. I see many confusing "deflation" with the death of a currency, again. Let's be honest, this has happened before.
They have gone too far with total debt issued. Inflation may help some and has traditionally been the mechanism they purposefully create to open the door for more debt issuance. It is ineffective at this point.
Write down time.
Wait, why do I have to pay it off? I don't remember taking the debt out, and I don't remember getting anything for it.
Deflation in the trust and confidence in govts, central banks, bureaucrats, and official statistics is ALWAYS a good thing.
Deflation in the trust and confidence in govts, central banks, bureaucrats for 102 years
Would it be so terrible if college tuition, house prices or healthcare costs deflated back from the stratosphere and were affordable again?
Apparently.
"We don't have to listen to this crap." Janet Napolitano
http://cnsnews.com/blog/eric-scheiner/napolitano-protestors-we-don-t-hav...
Classic, thanks.
She looks like a squirrel with a bad thyroid that lives in a McD's dumpster
well, central banksters should have known better
QE/ZIRP is disinflationary ... deflationary when asset bubbles burst
and now they're cornered ... went waayyy too far into the briar patch
One of my favorites, "whatever you do, don't throw me in that Briar patch Brer Fox!!!" -- Brer Rabbit.
I can't see why people still think that central bankers hate deflation. Deflation is the central bankers' justification for printing money and printing money is done to weaken their respective currency. Of course none of them will openly admit the real reason and that's where deflation comes up. Weakening currencies is the way to regain competitiveness against >2.5B people living far from the "western" standard
Only so long as the RoW is willing to accept your confetti fiat as WRC. Do a little reading......all of our alies are joining AIIB with Russia, China, BRIICS, UK, France, Germany, Australia, etal. The US Petro$ is about to quietly exit screen right wiht a whimper. It is Friday, do you know where your assets are?
Falling prices are nothing compared to the problems deflation creates for debtors. The borrowing was done when prices were higher. When repayment must be done with less income there is pain...and default.
Remember, the big problem is all the debt!
When debt can't be repayed then money leaves the system (because one man's debt is another man's asset.)
This usually causes the central banks to buy assets and convert them into liquid cash. They do this because if there isn't enough 'liquidity' economic activity slows, taxes revenues fall, there is less to spend and all hell breaks loose.
When they print the extra dough people finally see that they won't stop and they then begin to question the value of the currency. They panic and hyperinflation is triggered as those who do have money try to spend it before it becomes worthless.
...at least that's what is on the schedule for next week...now back to Bob with the weather...
Perspective is everything.
Inflation - Good for the Banks.
Deflation - Good for people
exactly
and why federal reserve / wall street hate it
increased productivity should lead to naturally occurring rate of (mild) deflation ... but central banks fight this tooth and nail
Central Bankers want to inflate their debt away. Also in the west there still many folks that still live in over inflated homes with mortgages so if house prices decline banks end up with many houses in negative equity, making the banking sector look less safe. They should have let the housing bubble deflate completely because there is still are lot of pressures in the housing market. With Central Bankers pumping out cheap money, buying bonds and equities the whole market is distorted and these pressures building up like a spring. The bond bubble will exlode this year and then globally the markets will crash when they all start looking for the exits. Governments need to have a hands off policy so real price value can be found.
inflating debt away no longer an option ... too much debt (from pulling forward demand) in the system that needs to be serviced ... leaving leaving many households/govts/corps burdened
the only option is write downs ... massive write downs
The only option is write OFFS......massive write OFFS
fixed it for ya.
Ha ha ha. We love deflation. We make deflation by pulling ‘money’ i.e., easy CREDIT out of system. Makes goyim need ‘money’ to buy basic necessities. No ‘money’ means no food, shelter, heat, etc. Goyim must sell everything to kosher tribe for pittance. International kosher tribe controls all levers of money creation and emission. We fabricate so-called ‘boom-bust’. Stupid goyim never learn. We control mass media. We tell you deflation good for you. You blind goyim believe all we tell you. Otherwise we call you anti-semite and make goyim pee pants. Oy vey!
Idiot. (said affectionately). Less money means lower prices.
Less money = lower prices, yes! Good for one who has money. Look around. Who has money? Most goyim only have debt. Only the 1% - the kosher tribe have money. Heh heh heh. Look at Great Depression. We pull money out of system. Can’t pay on debt without money. Huge transfer of wealth. Many goyim lose everything. Kosher tribe buy up everything for pennies on dollar. Kosher tribe foreclose on goyim holdings. Goyim struggle just to eat. Then we start cycle over again. International money power injects easy credit ‘money’ back into system. Put more goyim back into debt again. We suck your life-force out of you this way. Silly stupid goyim.
I agree that with deflation, cash is king.
Only ‘cash’ goyim will have is under mattress. Bank account cash get drained to pay bills, buy food. Prices go down because hard to sell. No one has ‘cash’ to buy with. Deflation means money supply is severely contracted. It is opposite of Weimar Germany. Goyim had lots of ‘cash’, but not worth anything. Hitler threw out kosher bankers and fake money. Made Germany thrive on real money system. Today kosher money system will force you to sell your products and labor cheap because ‘money’ will be scarce. No one can buy. Prices go down, down, down because no one has money. That is deflation. Oy vey!
Shut up you racist piece of shit. You're not funny
Hahaha. You are perfect example of stupid goy. Incapable of rational thought. Can only provide ad hominem attack. We programmed you very well. One thing for sure – you are anti-semite.
I've finally come to realize I want deflation and/or hyperinflation. I will adjust and am trying to be prepared for either. It is this japanlike zombie stagflation keeping the status quo going which is slowly killing us all. It must end ASAP.
The funny thing is that we could go from a deflationary environment to hyperinflation almost literally overnight.
When the government debt bubble pops, we'll be heating our homes with dollars...
Do you think the hundreds bills give off any more heat than the singles?
The US simply cannot allow deflation. Heaven forbid that our consumer-based economy start to repair their balance sheets by saving money and paying down debts.
Mush, debt slaves...!!!
it just gets worse every day. With the housing bubble you new for 2 years it was going to be awful. This feels worse.
Agreed. It's hard to produce graphs and charts of feelings and intuition. Maybe that's a good thing.
Deflation is a necessary part of a free market system. Prices get ahead of themselves and they need to correct on occasion via deflation. People who made loans or bought stocks at valuations that made no sense need to lose money on occasion. It's not a perfect system, but it works better than the others and brings discipline into the system to allocate capital appropriately.
The central planning, over-leveraged fractional reserved world doesn't actually work as well. There needs to be a market based limit on debt growth so that excess gets punished. Too big to fail and bail outs have removed that discipline.
A good example is oil. We see no mechanism in place on the production side to handle any substantial price decrease. If all the equipment was owned outright with no debt, it would be a completely different world. And even in the worse case scenario, only the oil producer is affected, not the financial markets in a chain event.
"The Fed, the ECB, and the Bank of England repeatedly tell us that deflation is extremely dangerous for an economy"
What they really mean is deflation is extremely dangerous for their dark overlord's portfolios
As to the impact of deflation on those with mortgages - I would argue that the 2007/2008 USA housing bubble pop put anyone underwater who was going to be there - the pain has already been felt. Now it is only big Investment Funds who bought up all the (some illegally) foreclosed units. I think that they could stand to feel a little deflationary pressure, myself.
If someone got too leveraged in housing after the lessons of 2007 / 2008, then I'm sorry when they go underwater (individuals not corps) but I don't think that I should have to pay for their d-oh! moves.
most were illegally foreclosed upon. the banks and their bank allies trashed 500 years of real estate law that required proof that someone actually owned the mortgage. Almost all the mortgages were in some fashion subjected to MERS which subsequently usurped that historical tradition.
Take a look at the deed you get now in most real estate transactions. I no longer own a home but I'd wager that most are not warranty deeds.
Yup, no Warranty Deed, walk away from the closing table.
When that story even got limping along the MSM ignored it. The level of theft was so huge that it could not "reported".
Another great wall street innovation these days is the "special warranty deed".
You have to watch out for those because the grantor warrants nothing prior to that transaction. So if prior to that transaction, the property was sold and "insured" against default 50 different times, you could get sued by these 50 other parties.
That's what MERS was pretty much all about, selling the same property more that once at the same time.
want a good laugh? ask a realtor "what kind of deed am I going to receive?"
They have to run and open the trunk of the car to find "that exam I had to pass"
"I remember that question"
But probably got it wrong and passed anyway......................
Perhaps the central bankers and economists from all over the world should take a break from the theory and their focus on economic models and instead have a look at the real world and spend some time talking to Volcker in order to remember that deflation is not the disaster they imagine it to be.
This statement is predicated upon the disasterously mistaken idea that the banksters have ANY interest in a healthy economy for the masses. It's exactly the opposite: every bit of what is happening is being done intentionally, for the purpose of bankrupting the entire world, so as to foreclose on humanity itself.
Parasites. Psychopaths. Evil Incarnate. The banksters must be wiped from the face of the Earth, or the majority of humanity will be. These are the facts.
.Gov is a debtor and enjoys 1-2% budget annaul budget growth. so deflation is a disaster for them. Without more debt or more .govjobs (mouthbreathing Kool-Aid drinking tyrants), .gov can't as effectively tyrannize.
Deflation is a killer for people holding debt. The whole system was predicated on devaluing currency, and paying off debt with dollars that get forever cheaper, and gaming the system all along the way to drain real wealth. People without debt will be in good shape. But this leaves out governments, they are buried in debt. This will be like going over Niagara Falls, you can only choose the spot at the top where you start the ride.
Prick Yellen with a sword - watch her ugly fat ass deflate
https://youtu.be/LLrTPrp-fW8
It's not nice to fool mother nature.
In a true free market with supply and demand...there has to be deflation once in a while.
It removes the stupid factor every once in a while...eg $1000 tulips and $100 billion dollar dot.com companies.