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?
They're not. You're logic is "people will get money and spend it"
But we've been through this before. People spend money on paying down debts, the rest forms a one time impulse that doesn't change structural spending or wealth creation.
You create a false signal business chase, then have to reorganize going back to where real signals are coming from.
Are you describing the United States' recent attempts to buy votes with stimulus checks instead of addressing the economic disparities in its society, such as the existence of citizens, united and the weakness of Dodd-Frank, as somehow being socialism?
It made races more competitive. It has served to threaten incumbants, giving more power to challengers.
"addressing the economic disparities"
That's not what "Wealth creation" means here.
It means creating actual value. Stimulus checks do less than they waste. You don't create value by shuffling money around. You do create a crowd out effect and misleading signals.
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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?