Low inflation might be the first step towards deflation. Many economists would argue that deflation is a worse situation for the economy because it leads to a sharp drop of consumption and therefore a huge recession follows?
A deflationary crisis has nothing to do with wealth concentration and almost everything to do with liquidity. Japan is your best example for that.
Believe it or not, more socialism isn’t the cure for everything that can go sideways in an economy. A bank failure can cripple a welfare state like it did with Iceland, debt and lack of liquidity blew up the Eastern Block, Dutch Disease killed Venezuela and sadistic bailout conditions wrecked Greece.
The Greek crisis was caused by Greece becoming unable to service its debt. It became so bad because Germany, Austria and the Netherlands wanted to make an example of Greece and gave harsh conditions.
The Greek banks had very little to do with it. Maybe 200 people in Greece were responsible for the shitshow.
This would leave you believing that the Soviet Union and associated Eastern bloc countries were "peak capitalism," which would be a tell that the word "capitalism" is just a question begging term for "things I don't like about the fact that resources are scarce" in your vocabulary.
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u/StuartMcNight 9h ago
Low inflation might be the first step towards deflation. Many economists would argue that deflation is a worse situation for the economy because it leads to a sharp drop of consumption and therefore a huge recession follows?