BNET Business Dictionary
Business Definition for: Deflation
- a reduction in the general level of prices sustained over several months, usually accompanied by declining employment and output
Wiktionary Definition for: Deflation
- economics A decrease in the general price level, that is, in the nominal cost of goods and services as well as wages.
Additional Resources
- The Fed Fears Deflation More Than Inflation
- In his interesting post, Scott Sumner argues that deflation is more likely than inflation, and that if it occurred, it would damage the economy by effectively raising labor costs to firms, forcing them to lay off more people and worsening our unemployment problems. In contrast, I view deflation as less...
- Blog posts 2009-06-29
- Deflation In The U.S. Why The Concern Now, And What Does It Mean For Institutional Investors?
- A stagnant U.S. economy, the lowest interest rates in over forty years, and extremely low inflation have in combination fueled debate on whether the country may be headed for deflation. The purpose of this article is not to predict whether the U.S. will experience deflation, although many economists believe that...
- White papers 2003-01-01
- Deflation is Our Biggest Worry -- Not Inflation
- Many economists are worried about high inflation over the next few years. This is based on a misdiagnosis of the current economic crisis. Although the recession officially began in December 2007, until last August the damage was mostly confined to housing and finance. In August 2008, the recession spread to...
- Blog posts 2009-06-26
- Deflation
- In common usage deflation is generally considered to be "falling prices". But there is much more to it than that. Often people confuse deflation with disinflation or with Depression (as in "the Great Depression"). These three terms are related but not synonymous. It explain about what are the causes...
- White papers 2003-01-01
- Why We Should Fear Deflation?
- After more than sixty years, deflation has reappeared as something to worry about. Next to no one had seen actual falls in the price level as even a remote possibility. Given that deflation is back on the agenda, should it be feared? Perhaps we should not worry about deflation because...
- White papers 1998-04-01
- Presupposing Deflation
- Whether deflation is beautiful or ugly can be in the eye of the beholder. In our private consumer lives, we are all for deflation. In fact, we work hard to find ever lower prices. How can we be having deflation when everything seems to be going up in price? Won't...
- White papers 2003-05-17
- Deflation: The Fed's Ugly Pit Bull
- Mark Caffee submits: If you are unfamiliar with deflation, you are not alone. In fact, the past 80 years has been the antithesis of deflation.....inflation. Inflation is as American as apple pie. A right of passage from one party to another, or one Federal Reserve Chairman to...
- External links 2008-11-04
- Deflation? What Deflation?
- This article will explore whether deflation is destined to simply remain a word in the dictionary or a word we will live with every day. Deflation is not the same thing as "disinflation," the latter of which is defined as a downward movement in inflated prices to a more...
- White papers
- Deflation or Delusion?
- Deflation, or rather that word, has given market commentators something they have not had since the "New Economy." Articles have been spawned on the fear of deflation in a short period of time than would be the case with a major national disaster. The deflation focus has now been used...
- White papers 2003-05-30
- Bernanke and Obama's Advisors Are Wrong: Deflation Didn't Threaten the U.S. Economy
- Gerard Jackson submits: I was going to explain in greater detail why Obama's economic stimulus would fail and why his view that only the government, meaning his administration, can get the economy moving is unadulterated nonsense. However, we are still being regaled with tales of how deflation is a dangerous...
- External links 2009-01-19
- Putting Deflation Risk In Perspective
- Worries about deflation have taken center stage in financial markets. While concern is justified, and forces encouraging deflation are evident in the U.S. economy, the risk of a secular deflation is low. Both the adjustment capacity of the U.S. economy, and the power of monetary policy, provide important defenses against...
- White papers 2003-03-19
- The Perils Of Deflation
- Many financial advisers are sounding the alarm: "The forces of deflation are gathering strength and threatening to take over. The stock market is pointing the way and the economy is following." Some even are seeing signs of impending calamity: "The United States is staring into the same deflationary abyss.Deflation, according...
- White papers 2003-04-04
- The Slow Start of Deflation: A Case for Bonds
- Commodity prices are cracking up left, right and centre. Ospraie - one of the stars of the commodity hedge funds - has blown up. The speed at which things unravel is sometimes startling. Slowly but surely, the global real estate asset price deflation is moving to other asset classes....
- External links 2008-09-03
- Fed official: Deflation could impact bank earnings
- With the Federal Reserve keeping interest rates at historic lows, deflation is unlikely, said Gary Stern, president of the Federal Reserve Bank of Minneapolis.Stern would not rule out deflation, however, and said small to medium-size businesses and their lenders would potentially be hit the hardest in the event of rapid,...
- Research articles 2003-07-15
- Inflation-Deflation: Macroeconomist Smackdown
- Of all the different vital signs for the U.S. economy, the measure that's drawn the most attention has been the rising unemployment rate. Inflation hasn't been as newsy, because prices have been pretty tame. But the long-term picture for prices is still unclear, and there's a hot debate among economists...
- Blog posts 2009-05-11
- Clothing and footwear deflation increases to 5.7%
- Shop prices have fallen on a year ago and were deflationary for the second consecutive month, according to the British Retail Consortium-Nielsen Shop Price Index. Annual non-food deflation was 1.4% in September, unchanged from August. Deflation in clothing and footwear and furniture and floorcoverings accelerated compared with previous month. Annual...
- News items 2009-10-07
- Deflation? What Deflation? - Jeanne Lee
- It must have struck many Americans as laughable in a bitter kind of way when Alan Greenspan expressed concern last month about deflation. That's deflation, as in the opposite of inflation, as in prices going down and our money stretching further than it once did. The article defines that deflation...
- White papers 2003-07-01
- Who's Afraid of Deflation?
- We think deflation fears are overblown, but it never hurts to ask, "What if?" When we look to stock market history, does deflation deserve its reputation as a stock market suppressant, or is it getting a bad rap? The stock market posts above-average returns when consumer prices are relatively stable....
- White papers 2003-08-01
- Inflation Or Deflation?
- Today, just like any other day in the past few years, one of the greatest economic debates still swirls around the inflation or deflation question in the States. This old debate continues to rage because the stakes are so high for everyone. Inflation is only possible when the general level...
- White papers 2003-08-01
- Deflation's Profit Squeeze
- The crosshairs of deflationary product price trends and rising payroll costs are triggering an unprecedented gross profit squeeze for distributors who rely solely on margin mark-up pricing. Here is the evidence on deflation in the industrial economy, the profit impact of these trends, and three strategies for survival. Deflation wreaks...
- White papers 2003-01-01
