(I’m American) Inflation is the rising cost of goods and services. Inflation constantly goes up by varying degrees. When economists say “inflation is decreasing”, that just means that the rate of inflation has slowed, not that inflation reversed.
If inflation is causing money to be less valuable over time, why would it be bad to have deflation? Would that not make my money more valuable? I’ve been told it would be very bad, but not in a way that I understand
In: Economics
The primary thing to understand about economies is that activity is good and stagnation is bad. When people are buying, selling, and investing, that is good. When people stop this activity, economic performance falters.
In a deflationary environment, the value of currency goes up over time. This discourages spending money, investing money, and trade in general. All of these things are bad for economies.
It’s as simple as that.
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