Quote from: Truecurrency on March 15, 2015, 08:54:59 PM

Quote from: tee-rex on March 15, 2015, 06:22:23 PM

Quote from: ChicagoSchooler on March 15, 2015, 06:04:05 PM

Quote from: tee-rex on March 15, 2015, 05:39:34 PM

Quote from: ChicagoSchooler on March 15, 2015, 05:30:34 PM

Deflation is not the same as depreciation. Deflation is a decrease in the general price level. Depreciation is the consumption of capital.

You seem to be writing just for the sake of writing and having your word heard. What exactly do you disagree with me on? I never said that deflation is the same as depreciation, I was trying to explain the psychological motives behind human behavior, why people will still spend under deflation.

They may continue to spend during deflation, but they spend at lower rates evidenced by the drops in velocity.

Deflation and depreciation cannot be related. Since depreciation is consumption of capital, yet deflation is an increase of the general price level without any consumption, there is no way to relate them sensibly.

Just in case, deflation is a decrease in general price level. Depreciation means a decrease in value (just like deflation a decrease in price), what you refer to here is a narrow definition from accounting (but this is still the same concept of losing value). I think I explained it pretty well to repeat myself in respect to psychological aspects being effectively the same for both deflation and depreciation.

tee-rex, you're wrong buddy. Deflation does increase hoarding and lack of incentive to spend money. As others have said, deflation alone is bad for an economy. Also depreciation is not the same as Deflation....where are you getting this stuff from?

Hey, man, did you read the post where I explained it all? Depreciation is not the same as deflation, I'm curious beyond myself how you could get my point this way. But if you, nevertheless, got it so, then you obviously have not understood a single bit of what I had written about. Deflation works the same way as depreciation, psychologically, that's why postponement in consumption due to deflation per se will only be temporary and short-termed (I don't mean here an aggregate demand collapse which caused deflation, to clarify this point beforehand).

Actually, it was me who had shown here why precisely deflation is bad for the economy.