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Ever get the feeling that our monetary leaders are running a grand experiment and have no idea how it will all turn out? Yeah, me too.
Perhaps Switzerland knows.
August 14, 2014
Swiss Deflate the Deflation Theory
For more than four years, consumer prices in Switzerland have risen at an annual pace well below 1 percent. In 2012 and 2013, the country even experienced deflation. Yet its economy has grown at a steady pace, and is expected to expand by 2 percent this year. The unemployment rate is a low 3.2 percent.
We should be so lucky. Perhaps they should too. Over the long-term, their real GDP growth is slowing relentlessly (as is quite evident when using the log scale).
Wow! I managed to make it through this deflationary post without mentioning Japan. Well, almost.
EIA: Natural Gas Spot and Futures Prices (NYMEX)