Cryptocurrency Q&A
What deflation is bad?
What deflation is bad?
lucas_jackson_pilot
Tue Nov 19 2024
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5 answers
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I'm curious about deflation and its negative impacts. Specifically, I want to understand why it is considered bad and what consequences it brings to an economy.
5 answers
KatanaSword
Thu Nov 21 2024
This situation often leads to a decrease in economic activity and can be detrimental to the overall health of the economy.
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Daniela
Thu Nov 21 2024
Negative money shocks are one example of an event that can cause bad deflation.
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KatanaBladed
Thu Nov 21 2024
These shocks are non-neutral over an extended period, meaning they have lasting effects on the economy. An instance of this occurred during the Great Depression.
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SeoulSerenitySeekerPeace
Thu Nov 21 2024
Deflation is considered "bad" when it arises due to specific economic circumstances.
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DongdaemunTrendsetterStyleIconTrend
Thu Nov 21 2024
Specifically, bad deflation happens when aggregate demand declines at a faster rate than the growth in aggregate supply.
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