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Subject:  Re: THE INFLATION ILLUSION Date:  5/27/1999  9:00 PM
Author:  exmsftfool Number:  27120 of 284102

Hmmm, deflation means money now is worth more than money later.
A little bit of inflation is a good thing, it encourages investment.

No, deflation means money now is worth less than money later. That discourages debt, not investment.

A little bit of inflation is not a good thing. A little bit of deflation is a good thing. Most people tend to get slowly better off.

A lot of deflation hurts a lot, but if recognized the cure is much easier than it is to kill inflation.

Finally, steady inflation is economically a non-event, especially at low levels.

It is unexpected, inflation that can cause some beneficial effects. But it tends to be a one-time-shot until people catch on. That is why Keynes did not have a general theory like he claimed, but a specific one.

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