| Kasz216 said: Explain how you think government stimulus actually prevents a deflation spiral. It's just replacing a credit bubble burst. With a government stimulus bubble burst. There is always a double dip because your just creating another bubble that will burst again.
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But your tone says that you assume that the two dips will equal a greater negative impact than one larger dip all at the one time. Mafoo argues the same in his last post. Just let everything crash and then immediately start recovering.
Huge dips versus gradual ones arguably are less able to be coped with and absorbed by larger numbers of people and perhaps a country as a whole. For example, is a steady downward march in the stock market worse for a total of 20% loss in value worse than a 17% one-week crash? I'd argue not.
Had we allowed the economy and businesses to bottom out instead of infusing cash in to the system, we could have been facing much worse than we are. We'll never know for sure, but the global economy and ours in particular was in real danger in late 2008 and again in early 2009.
You can't cure the people's cancer if you let them bleed to death in the meantime.
Can't we all just get along and play our games in peace?
