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June 2, 2013

[SSJ: 8090] Is Deflation Bad For Japan?

From: Robert W. Gordon, Esq. 
Date: 2013/06/02

Could someone explain deflation and how it relates to Japan for me?

(I'm a lawyer, not an economist, so please explain in relatively simple terms).

What is deflation? Is it bad for "Japan"? If so, why?
If not why not?

News articles such as the one from the New York Times below, seem to imply that deflation is a very, very bad thing and what Prime Minister Abe is attempting to do with his economic policy is great.

See:
http://www.nytimes.com/2013/06/01/business/global/in-ja
pan-a-hard-to-budge-obstacle-looms-over-the-fight-with-
deflation.html?_r=0

But how does one square that with this article here, which claims deflation can actually be "good"?

See: http://mises.org/daily/4618/

What about the idea that 0% inflation should be a target?

Thanks.

Bob

Approved by ssjmod at 10:38 AM