Sandvol
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In mathematical or physical terms inflation is an expansion of the money supply and deflation is a contraction of the money supply. Those are very simple explanations. You can have speculative bubbles that are a product of inflation and an expansion of the money supply. Think of the money supply as a big balloon the size of the planet Earth. Assume it has a smooth surface and you can either let air in or out of the balloon. As the balloon shrinks or swells based upon money supply this is either deflation or inflation. Now suppose the surface is not smooth but marked by mountains and valleys on the surface. For instance the whole ball can be deflating but a mountain can be springing up locally on its surface. This would represent a speculative bubble in an overall deflationary environment. This mathematical definition of inflation or deflation is only a product of social mood. Inflation occurs because social mood is net positive or deflation occurs because social mood is net negative. Those are the root causes.