(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
Remember deflation includes wages so your average person will be earning less and less each year. This is all while the amount they owe on their car/student/home loan remains the same. Conversely the rich who tend to have excess savings rather than debts can sit on their money like a dragon does on a hoard and it will make them richer and richer every year.
Small inflation forces them to invest that in stuff like new factories which employ people if they want to maintain it.
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