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overtheedge
Member since May 2012
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Eurozone Falls Into Deflation; ECB About to Do Something Stupid - Mish - Global Economic Analysis

"What central bankers "ought" to fear is asset-price deflation, not routine price deflation. "

Wrong again.
Deflation and inflation are purely monetary quantity matters.
Asset prices dropping means the quality of the collateral is dropping.
The loan officer might be experiencing a severe loosening of the bowels, but ...
The quality of the collateral means absolutely nothing as long as the debt is being serviced.
Falling prices means profits are falling which directly affects the ability to service debt.

Commented 3389 days ago

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Beginning of the headline :As expected, the Eurozone fell into deflation last month, but details show energy and unprocessed food are the only things in decline. Services are up 1.2%. Please consider the Eurostat Flash Inflation Estimate for December 2014. Euro area annual inflation is expected to be -0.2% in December 2014, down from 0.3% in November, according to a flash estimate from Eurostat, the statistical office of the European Union. This negative rate for euro area annual inflation in December is driven by a fal... Read More

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