The economic meltdown since 2008-9 has created disinflation, and even deflation in some countries in the Euro-area, in … disinflation and deflation push up the real interest rate, while growth and income declines, the leveraging problem becomes more … feedback loops, given the debt deflation, we demonstrate the possibility of unstable dynamics and downward spirals in the …

the (incipient) deflation that China now faces. It could create a zero-interest liquidity trap in financial markets that … leaves the central bank helpless to combat future deflation arising out of actual currency appreciation, as with the earlier … experience of Japan. Exchange rate appreciation, or the threat of it, causes macroeconomic distress without having any …