Perspectives on deflation
Deflation carries no terrors for a flexible economy
From Hong Kong, Tony Latter says that despite over five years of deflation, there is no reason to panic. The flexible economy has allowed the economy to shrug off ill effects. Sure, declining wealth has curtailed spending, but prices and wages have also moved down; banks remain tough despite balance sheets weakened by debt deflation and any effects of high real interest rates are difficult to identify: "any negative causation running from
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