deflationary spiral

• Failing Economies Need Big Jolt -- Just Ask Obama

Seeing the threat to the world economy's vital functions, the policymakers have been working overtime. Interest rates have been cut dramatically. American rates are already down to one per cent; Britain's are at a 50-year low; and this week China's central bank lopped 108 basis points off its main policy rate. This was a "global crisis," he argued, which merited a "global response." The economy was "trapped in a vicious cycle" and needed a big "jolt" to ease the flow of credit and to cushion the drop in private demand. He is right. All the bank rescues, credit interventions and looser monetary policy will only get the world so far. The biggest part of [Barack Obama]'s "jolt," as he made clear, must be fiscal. When private demand sags so dramatically, the public sector must step in to bo...

... the United States -- a vicious deflationary spiral of banks withdrawing credit and demand cont...

• Winnipeg Free Press
• September 01, 2009

• To Stimulate, or Maybe Not

...In an inflationary spiral, you get too many dollars chasing too few goods. T...In a deflationary period, you get too few dollars chasing too many g...

• Winnipeg Free Press
• August 25, 2010