Inflation usually helps the economy at large, but not the 1% if wages rise. So the 1% says that it is terrible.
Michael HudsonThe price decline is a result of having to pay debts. That drains income from the circular flow between production and consumption - that is, between what people are paid when they go to work, and the things that they buy.
Michael HudsonThe problem is indeed that one party's debt finds its counterpart in some other party's savings. Not paying debts therefore involves annulling some other party's financial claims on the debtor.
Michael HudsonPeople think that this concept of GDP is scientific economics, partly because it has a precise number and can be quantified. But the underlying concept of "the market" makes it appear as if today's poverty is natural. It makes it appear that Goldman Sachs and Donald Trump are job creators instead of job destroyers. That is illogical, when you think about it.
Michael HudsonThe current U.S. and Eurozone depression isn't because of China. It's because of domestic debt deflation. Commodity prices and consumer spending are falling, mainly because consumers have to pay most of their wages to the FIRE sector for rent or mortgage payments, student loans, bank and credit card debt, plus over 15 percent FICA wage withholding for Social Security and Medicare actually, to enable the government to cut taxes on the higher income brackets, as well income and sales taxes.
Michael Hudson