17 example sentences using deflation.
Deflation used in a sentence
Deflation in a sentence as a noun
Or the desire to have a store of value that never suffers deflation or inflation. We all want that, but most of us acknowledge that it is no more possible than a utopia.
There's a creed in mainstream economics that deflation is bad, repeated here." if your money is getting predictably more valuable, why would you want to spend it?"
There's a reason countries abandoned the gold standard: deflation and bank runs are harder problems to manage than inflation.
>> For starters, BTC is inherently deflationary. > For starters, tell us why this is inherently bad.
If blockchain currencies are the future, central banking is over, and our society will have to figure out how to make the economy work with endemic deflation. I think central banking is useful, but I don't see a future for it.
Widespread deflation" well, both the US and Japan have had bouts of deflation recently, that wasn't due to technology but rather central bank decisions." The neo-Ludite movement is growing" its less of a problem than in 1999, as far as I can tell.
Many physical currencies have enormous price fluctuations, and even experience deflation. 20 years ago Brazil had an inflation rate of 6281%.
Statements about how inflation is "erosion of wealth" indicate a gross misunderstanding of the historical purpose of money and the effects of deflation. Money is a medium of exchange.
Furthermore, economists generally regard a small amount of inflation as better than a small amount of deflation. First, inflation helps keep prices and salaries less sticky, by constantly devaluing them.
I think this argument can be discounted simply by looking at the current state of things--people are still spending bitcoins even though the recent appreciation dwarfs any built-in deflation. Sellers may need to discount their price to get people to pay in bitcoins, but even that doesn't seem to be happening yet.
>> it has reached its maximum of 21 million bitcoins, the deflation should be a lot smaller That's when deflation in bitcoins will get worse, because while wealth will increase, the amount of currency in circulation will not.
It'd also be interesting to look at the effects of deflation in the fledgling bitcoin economy, although the actual exchange of currency for goods and services is a bit small to judge this effectively.
Historically, deflation is disastrous for everyone, and high inflation also disastrous for everyone. Moderate inflation has the effect of redistributing wealth from capital to work, and tight money the effect of redistributing wealth from work to capital.
The parts about how the USD works and the suggestion that Demurrage would do anything at all to fix the deflation issue are also particularly weak. It also doesn't do any favors to Bitcoin by suggesting Freicoin alongside it; It's possible to imagine a world where the advantages of Bitcoin economics outweigh the disadvantages, but Freicoin is outright kookery.
- It neatly circumvents the issue of lost coins -- Bitcoins will keep dwindling over time and there will be no way to keep a consistent number of coins in circulation - Inflation puts to bed one of the major concerns raised by many traditional economists about Dogecoin; deflation does seem to encourage hoarding - As a corollary, inflation encourages spending, the growth engine of every modern economy. Like it or not, it works.
Quote Examples using Deflation
To be clear, deflation is categorically bad for a currency. It's terrible, like great depression terrible. The reason it's bad is that deflation makes it more profitable to do nothing than to invest. When this happens, people react by not spending money. The market dies. While inflation can be bad, it's at least manageable. In fact, some inflation is actually heathly as it encourages investing. If that doesn't make sense, think of it like this. Inflation is similar to nuclear fusion and deflation is like nuclear fission.
Anonymous
When Krugman says that the bitcoin economy has experienced deflation, he means that a bitcoin is worth more now than it was in the past. The graph on bitcoinmarket certainly shows this. If I wanted to buy a motorcycle in bitcoins in 2010 I would have needed several thousand. Now I only need a few hundred. Which means that I would have been stupid to spend my bitcoins last year. If deflation continues and bitcoins continue to be worth more and more, then the rational thing to do is never spend my bitcoins at all.
Anonymous
Deflation definitions
(geology) the erosion of soil as a consequence of sand and dust and loose rocks being removed by the wind; "a constant deflation of the desert landscape"
a contraction of economic activity resulting in a decline of prices
the act of letting the air out of something