While this article won’t help to appease anyone’s nerves about deflation, it is an interesting analysis about deflation. As the article states, “Economists don’t have good answers.’We don’t know how deflation works,’ says Adam Posen, a member of the Bank of England’s monetary policy committee who has been studying Japan since 1997. ‘We don’t have a way of rationalizing steady, several-year flat deflation.’ This is a pressing issue for the U.S. Federal Reserve and other central banks.”
The article explains that we may not, in the end, need to fear a deflation. Certainly, this would be the best possible scenario for investors like Gregg Hymowitz and so many others.