Teutonic Knight

Deflation Is Just Around the Corner

Much had been written and debated about this topic - will it be deflationary or inflationary.

Granted , on the surface, that commodity prices, housing, retail and household goods items prices, among others will most likely drop, as the economy worsens, let us recognize that corporate and personal earnings will also decline.

So while the CPI recedes, disposal income will also come down. If indeed the current crisis leads to a deepening recession and even a depression, consumers will have less bucks to chase after goods, and that means inflation.