On Thu, Aug 13, 2015 at 3:25 AM, Alain Sepeda <alain.sep...@gmail.com> wrote:
> deflation is natural and sane in economies where there is growth of > productivity. > This is a good way to increase wages. > You seem to be describing not deflation but the lowering of the prices of specific commodities due to price pressure arising from increases in productivity. I'm going to hazard a guess that economists don't think of this kind of downward price pressure as deflation, especially of the kind seen in the Great Depression. Deflation in that instance was across the board. If you held on to your money, it would be worth even more a week later. There was an incentive to refrain from spending and to keep your money in a can under your mattress. In a healthy economy, you might want to wait for two or three months to purchase that television or stereo system or car, because the price might be about to come down; but while you wait your money would become worth a little less overall because of a slight amount of inflation. If you did not intend to spend it you would want to put it to some other good use -- in an investment account or a savings account. Eric
