Inflation Vs Deflation
Posted by financialplanner8 on December 16, 2008
Most people are familiar with inflation. It’s when the value of your dollar declines vs. things like gasoline, real estate, and food. Inflation is murder on cash held in the bank or under the mattress. Inflation helps borrowers because the RM100 you borrow now actually is worth less and less in the future.
While on the other hand Deflation is much less well known. Put simply, it’s when the value of your dollar rises vs. things like gasoline, real estate, and food. Deflation kills borrowers because the RM100 you borrow now is worth more when you have to repay it.
