European Bank Fights Deflation By CHARGING for Saving Accounts

[icenine]

Originally Posted by donquixote99

With inflation, people try to get rid of cash. With deflation, it's stuff that's dropping in value, so people try to get rid of inventory. This basically means not making anything--no one likes making stuff that's going to drop in value. people get laid off left and right, which drives down demand, so there's more downward pressure on prices, and more layoffs.

This was the great depression. Death spiral.

Yes

imagine that the economy is a tire that has gone flat because there is no demand at all. Prices are too low to stimulate production i.e. employment.
In the Depression food produce from farms was so low in prices that it did not pay to transport items to market. Thus the AAA under Wallace (I think) paid farmers to destroy crops and kill young pigs (who never got to enjoy their pigginess lol) in order to raise prices by decreasing supply.

the forefather of the farm subsidy which the Baggers love today btw


I do not know if it came to actually killing piglets but I am pretty sure Wallace proposed it.

ok some other History major help me out do not feel like goggleing it lol

[merrylander]

I went through it in Canada so I can't help you out there, and since I was only born in 1930 remembrance of the politics of the time is rather sketchy.

[bobabode]

Overlay the Dustbowl years on the Great Depression and you've got a catastrophe. That's when my grandparents came out to California from Colorado and Michigan.

[bhunter]

Originally Posted by icenine

Yes

imagine that the economy is a tire that has gone flat because there is no demand at all. Prices are too low to stimulate production i.e. employment.
In the Depression food produce from farms was so low in prices that it did not pay to transport items to market. Thus the AAA under Wallace (I think) paid farmers to destroy crops and kill young pigs (who never got to enjoy their pigginess lol) in order to raise prices by decreasing supply.

the forefather of the farm subsidy which the Baggers love today btw


I do not know if it came to actually killing piglets but I am pretty sure Wallace proposed it.

ok some other History major help me out do not feel like goggleing it lol

Yesiree, another progressive idea that lacked efficacy. Though nominally a republican, Wallace did indeed believe in controlling the levers of agriculture and industry from DC. Also, look at the wage and price controls during WWII and how they were contrived ostensibly for the war effort, but had effects well beyond that.

On the subject of Europe, I still feel a major event must occur there within the next several decades that will undermine the unity of the EU.

[merrylander]

Originally Posted by bhunter

On the subject of Europe, I still feel a major event must occur there within the next several decades that will undermine the unity of the EU.

Then Mlle LePen must be your darling as she hopes to break it up.

[bobabode]

Originally Posted by bhunter

Yesiree, another progressive idea that lacked efficacy. Though nominally a republican, Wallace did indeed believe in controlling the levers of agriculture and industry from DC. Also, look at the wage and price controls during WWII and how they were contrived ostensibly for the war effort, but had effects well beyond that.

On the subject of Europe, I still feel a major event must occur there within the next several decades that will undermine the unity of the EU.

Big fan of Herbert Hoover?