Re:U.S. inflation reached a new four-decade high of 8.6% in May
by rufus_foreman on Friday June 10, 2022 @01:47PM
(#31697259)
>> You telling me that if gas and food and rent lowered in price over time, I will be worse off?
If you have debt, you will be worse off. Wages get lowered over time, too. Imagine your salary gets cut year after year but your mortgage, car payment, and student loan payment all stay the same. That's deflation.
In the same way that unexpected inflation is good for borrowers (since they get to pay back a loan with cheaper money) unexpected deflation is bad for borrowers (since they have to pay back a loan with more expensive money).
If you have debt, you will be worse off. Wages get lowered over time, too. Imagine your salary gets cut year after year but your mortgage, car payment, and student loan payment all stay the same. That's deflation.
In the same way that unexpected inflation is good for borrowers (since they get to pay back a loan with cheaper money) unexpected deflation is bad for borrowers (since they have to pay back a loan with more expensive money).