Post
Topic
Board Economics
Re: The problem of a depreciating currency
by
odolvlobo
on 27/03/2013, 02:47:41 UTC
... because of the relatively fixed money supply and the deflation problems that caused. ...

I see this claim occasionally, but I don't understand it. What exactly are the deflation problems that a fixed money supply has caused? Some economists (Bernanke, for example) believe that any deflation is worse than high inflation. I would like to understand the reasoning behind this belief. Some claim that even low deflation leads to hyper-deflation, but history has shown this to be false.