Deflation or inflation, which is worse? It all depends on your point of view. In certain areas of the country housing prices had inflated to the point that only six percent of the population could actually afford a home. Deflation could then be considered a needed and good thing by many. Not so for those owning a home in that area.
Uncontrolled inflation is probably best illustrated by looking at Zimbabwe's current crisis.
A long deflationary cycle can be seen in the last 15 years of Japan's economy.
Neither deflation or inflation can be considered a good thing in a well run economy, but it is normal to see some inflation in an expanding economy and some deflation in a contracting economy.
Last edited by jungle; 12-06-2008 at 05:49 PM.