Lower prices may be manna to consumers, but they can cause economists to break out in cold sweats. Their fear: that one big D (deflation) will lead to another (depression).Recent economic data suggest that the U.S. may well be heading into its first significant bout of deflation since the early 1930s, with potentially major impact on consumers and investors. “That we are going to have deflation this year is a given,” says A. Gary Shilling, deflation expert and president of economics consulting firm A. Gary Shilling & Co. “The real road test is whether we end up with chronic deflation.”
By Carla Fried, Feb 6, 2009 WSJ

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