The Poison we call Debt

Following my previous post about deflation we see a further factor that my add fuel to the deflation fire. Despite increased growth in money supply we see the velocity of money falling off a cliff, why with all this monetary stimulus?

Irving Fisher would not be at all surprised by the current impact of excessive debt since he argued in his famous 1933 paper “The Debt-Deflation Theory of Great Depressions”, that falling money velocity is a symptom of extreme over-indebtedness. Van R. Hoisington and Lacy H. Hunt, Ph.D

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