we have never really had deflation, that doesn't mean people can;t be reasonable

Real deflation hasn't been tried.

I think it has. It's called a 'hair cut' the Greeks used to it.

okay, not in modern times

They understood the problem with fiat currency

deflation isn't really a problem, nor really inflation. its the rate of change that causes problems really

So Rye if your system doesn't take into account debt then I surmise there is no intrest on savings?

its not the fall that kills you, its the sudden stop.

Not true

If you fall from high enough you will have a heart attack 😉

well then its not hte fall that killed you still lol

So, if you bought gasoline at 2.60 a gallon, and filled a 20 gallon tank. Next day, gas is worth 2.20 a gallon...

The gas in that tank is worth the same as what you'd buy at the pump

I guess that works against my point in a sense

As far as a loan goes anyway

But ideally, if you're taking a loan, you're taking that loan for something that will add value

the problem with debt is that the debt needs to be adjusted for the rate of deflation, otherwise they are asking for more money that technically are owed

Such as property.

just like debt is adjusted over time for inflation

So it's preicated on only buying things that are neccesities. not fun alowwed

what would probably happen in deflation would be the ability to get a lower interest rate

The weird thing is a negative interest rate would be extremely gameable...

depends on how rapid things deflate

its more likely that you would see very low interest rates

because how quickly would you need to be deflating to get a negative interest rate

It'd likely be fair to waive interest.

thats more likely what would happen

with perhaps the option to get the last bit waived at the end

because it would need to devalue so fast that the amount you borrow ends up deflating so rapidly that it will cover the operating and profit margins over the course of the loan to get an interest rate of 0.

or a negative one

That seems like economy crash levels of change.

Rye here trying to push shria law over here. Fuck off undercove sand nigger

... Crap. I've been found out.

I would disagree. In my country the national bank runs negative interest rate on the accounts of the commercial banks. And the government issue bonds with a negative rate too, to discourage foreign investment in them

Where you form? Is that to discourage companies from hording money?

Denmark. Ever since the 70s the national currency has been pegged to the D-mark and later the euro

In order to keep the exchange rate constant the national bank must conduct a constrictive monetary policy

It is primarily to discourage other central banks and pension funds to not buy danish treasury bills.

The side effect is the global capital markets are funding the welfare state here.

In the late 70s early 80s the economy was in shit so the interest rate was 22% in order to keep on par with west germany.

If it's not the banks buy the bonds, who are they selling them to.