What is Inflation and Deflation?

Alex Merced made this video to help people understand the debate between inflation and deflation a little bit better.

Learn more at Mises.org, LibertyIsNow.com, Creatarian.com, and VoteMerced.com

Read:

Deflation and Liberty by jorg Guido Hulsmann
Money, Sound and Unsound by Joesph Salerno

Category:

News & Politics

Tags:

• Inflation
• Deflation
• Monetary
• Policy
• Credit
• Banks
• Economics
• Education
• Loans
• Economists
• Government

[MrFoofy]

Well I apologize, I haven't seen your other vids and only have a basic understanding of the economy. Only recently started to look more at what's going on. (I'm actually 15) So your word is probably better than mine.

[AlexMerced]

@MrFoofy no prob, sorry if I got harsh, trust me I've met PhD economists who make the same arguments... economics is heavily subject to confirmation bias, and there is no bias greater than hoping for easy answers. If you'd like to learn more I'd heavily recommend checking out my intro to economists playlist.

[AlexMerced]

@MrFoofy the quick way to get there is by going to LearnEconomicsNow doot Coom

[AlexMerced]

@MrFoofy also a quick way to do it is go to my channel and search inflation and you'll find 100s of videos on the subject

[MrFoofy]

FAR better than mine.

[AlexMerced]

@MrFoofy on top of it, once they buy stuff with the devalued dollar, the value of the dollar just get pushed back up plus you increase domestic inflation as more dollars float domestically when right now running a trade deficit is the only thing keeping all our money printing from causing rapid inflation domestically cause we shipping dollars overseas.

[AlexMerced]

@MrFoofy OMG, I'vve done so many videos onw hy devaluing currency to increase exports is a horrible idea. Sure, people buy stuff but then companies realize when they replace their inventories they can't because prices have gone up, if people want to export they accomplish the same thing by lowering their own prices instead of devaluing which affects businesses that don't need it, reducing their margins possibly causing viable businesses to become unviable.

[MrFoofy]

@AlexMerced I still think deflation wouldn't be helping at the moment. I think part of the reason for inflation is so we can inspire people to buy from us. With a weak dollar, other countries with stronger currencies can purchase our stuf for cheaper. It can really depend on if you want to do importing or exporting. Exporting is helped by a weak dollar. If you want to import you would prefer a strong dollar then, because then you can buy for cheaper. Could be wrong.

[AlexMerced]

@MrFoofy read deflation and liberty by Jorg Guide Hulsman, he makes one pretty good case in defense of deflation. My thing is they both suck, they transfer wealth, inflation is just preferred by asset and debt holders looking to protect their wealth, while deflation rewards pursuing income instead of growth. Investment doesnt end, it just shifts focus to income in deflation.

[AlexMerced]

@MrFoofy yes, debts are increased in deflation, but incomes are destroyed in inflation. Neither inflation or deflation is a good thing, they are economic responses to economic phenomena and preventing them to monetary policy is ignoring the real economic event underlying that the trend is a response too.