Inflation and deflation can disrupt the economy and erode purchasing power from "summary" of A Monetary History of the United States, 1867-1960 by Milton Friedman,Anna Jacobson Schwartz
Inflation and deflation are two phenomena that can have significant impacts on the economy and the purchasing power of individuals. Inflation refers to a general increase in the level of prices of goods and services over a period of time, while deflation is the opposite - a general decrease in prices. Both inflation and deflation can disrupt the economy and erode purchasing power. When inflation occurs, the value of money decreases, leading to a decline in purchasing power. This means that individuals can buy fewer goods and services with the same amount of money. As prices continue to rise, consumers may find it difficult to afford basic necessities, leading to a decrease in living standards. This erosion of purchasing power can have a ripple effect throughout the economy, impacting businesses, investments, and overall economic grow...
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