Since deflation leads to falling prices, would that create jobs, instead of kill them? Since people are more likely to purchase cheaper goods?

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DDX Project Profile
DDX Project answered

Do you want another Great Depression? This is how you get into a great depression.

When the value of money rises over time, people stop investing their money and their spending actually slows down. Why buy a house today when you can buy a house AND a car next year? People start holding onto their money. Therefore there will be less money circulating in the economy and less work being done. Creating a downward spiral of economic devastation.

Do realize that falling prices would also include falling wages. No spending, no borrowing. Economy = Toilet.

Maurice Korvo Profile
Maurice Korvo answered

Deflation would also mean a reduction of income. And with the amount most people owe on credit cards, loans, etc. They would be using most of their pay on interest, leaving nothing for spending.

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