tag:blogger.com,1999:blog-808460835100252240.post5150231912800644570..comments2022-09-01T15:12:33.736+03:00Comments on The Money Demand: Really great links - Krugman - CDS on non-existing bonds - Keynes & Hayek - FT on NGDPUnknownnoreply@blogger.comBlogger1125tag:blogger.com,1999:blog-808460835100252240.post-48657405119565026552010-03-19T20:19:09.247+02:002010-03-19T20:19:09.247+02:00Thanks for the links! Still have to work through t...Thanks for the links! Still have to work through them ... This "fear of deflation" is just a ruse by central banks to keep inflating the money supply. Deflation does not keep people from spending – they always spend what's necessary. And money NOT "spent" is then saved which means it is credit to someone who invests it for capital goods etc. thus it is again being spent, only not for consumption. Money never lies completely idle to any extent whether there's inflation, deflation, stability or a solar eclipse. For deflation to seriously happen, not only the current extreme credit expansion by the central banks and states (through "quantitative easing", stimulus packages, monetising and then spending national debt etc.) but also the money that was released into the economy PRIOR to the collapse would have to be "mopped up" again. This is nowhere to be seen nor would it be technically possible (confiscation aside) <a href="http://crisismaven.wordpress.com/2010/03/18/economic-fallacy-iii-looming-deflation/" rel="nofollow">so we will rather see inflation than deflation</a>.CrisisMavenhttp://crisismaven.wordpress.comnoreply@blogger.com