Monkey with a pin goes for inflation

srcandas

Pete Comley offered his very valuable (IMHO and that of other inmates here ) "Monkey with a pin" book here some time back. He is now working on a book about Inflation.

In response to his request for what we might like to see I offered I would like to see a clear explanation of negative inflation.

Anyone have any thoughts that we can pass on to Pete?

:beer:

gozomark

you know the definition of inflation, well, negative inflation is like that, only negative

Lokolo

Is it just about inflation or about inflation and growth?

srcandas

Lokolo wrote: »

Is it just about inflation or about inflation and growth?

I think that is what Pete is looking for.

So we have:

1. Negative inflation. What impact it has and how to recover from it.
2. The relationship between inflation and growth.

Lokolo does that say it?

Any more? :beer:

Reaper

I'm sure he would cover this anyway, but he ought to explain why inflation is a bad thing (savings, affecting different groups unequally etc). Also in what way it can be a good thing (government inflating away its debt, reducing real wages can sometimes make a country more competitive etc).

sabretoothtigger

A Pin sounds likely to cause deflation

srcandas

So far:

1. Negative inflation. What impact it has and how to recover from it.
2. The relationship between inflation and growth.
3. Explain why inflation is a bad thing (savings, affecting different groups unequally etc). Also in what way it can be a good thing (government inflating away its debt, reducing real wages can sometimes make a country more competitive etc).

Any more? :j

jamesmorgan

Any book on inflation needs be heavily focused on human psychology. The reasons why inflation occurs (and is useful) is mainly down to psychology. Give most people the choice between a 2% pay rise (with 4% underlying inflation) and a pay cut of -1% (with no inflation) most people would claim the former even though their buying power is worse. The reasons for this are complex but largely down to evolutionary psychology and areas like loss aversion.

Without fully understanding these reasons it is difficult to get a full grasp of inflation.

Lokolo

srcandas wrote: »

I think that is what Pete is looking for.

So we have:

1. Negative inflation. What impact it has and how to recover from it.
2. The relationship between inflation and growth.

Lokolo does that say it?

Any more? :beer:

Yes thats perfect thanks.

srcandas

1. Negative inflation. What impact it has and how to recover from it.
2. The relationship between inflation and growth.
3. Explain why inflation is a bad thing (savings, affecting different groups unequally etc). Also in what way it can be a good thing (government inflating away its debt, reducing real wages can sometimes make a country more competitive etc).
4. Any book on inflation needs be heavily focused on human psychology. The reasons why inflation occurs (and is useful) is mainly down to psychology. Give most people the choice between a 2% pay rise (with 4% underlying inflation) and a pay cut of -1% (with no inflation) most people would claim the former even though their buying power is worse. The reasons for this are complex but largely down to evolutionary psychology and areas like loss aversion. Without fully understanding these reasons it is difficult to get a full grasp of inflation.

Any more?

Thrugelmir

Are we discussing good inflation ( caused by productivity gains)

or

bad inflation (imported commodity prices for e.g.)