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<p>[QUOTE=&quot;medoraman, post: 947710, member: 26302&quot;]Deflation by its nature destroys an economy, that is the danger. It doesn&#039;t SOUND bad, but it is much more horrible than low to moderate inflation.</p><p>&nbsp;</p><p>An example, lets say we have deflation and everyone gets used to it. Then no one will spend their money because it will be lower tomorrow. Since no one spends their money, then businesses slow down, lay people off, then there is even less spending. A deflationary spiral is actually more sever than most inflationary ones. Inflation, on the other hand, encourages people to spend today, since prices will be higher tomorrow. This spurs economic growth, adds jobs, etc.</p><p>&nbsp;</p><p>One cannot judge inflation or deflation by their own circumstances, but by what it would do overall to the economy.</p><p>&nbsp;</p><p>Btw, I used to teach grad level economics, and can go into the boring stuff if anyone wants. </p><p>&nbsp;</p><p>Regarding why does the US issue debt and not more notes, there is very limited market for notes. Printing trillions more would lead to hyperinflation, so it isn&#039;t an option anymore. Not many good options left really except inflate our way out of this and take the money from average US citizens. That will be the &quot;tax&quot; the politicians levy next I am afraid.[/QUOTE]</p><p><br /></p>

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