Deflation is a death spiral. China is going through it rn. The currency gets stronger, but then people wait to buy stuff like houses because it will be cheaper in a few months. It creates a snowball effect as people all start holding off on buying and selling stuff, wanting the best deal possible, or then being unable to buy things if people hold off on selling.
Deflation is a death spiral. China is going through it rn. The currency gets stronger, but then people wait to buy stuff like houses because it will be cheaper in a few months. It creates a snowball effect as people all start holding off on buying and selling stuff, wanting the best deal possible, or then being unable to buy things if people hold off on selling.