Inflation – deflation – what is the answer ?
As recently as Oct 2008 the worry was for inflation and now the call is for deflation.
We got these stats from the Bank of Canada inflation calculator site.
$100 in 2003 = $111.38 in 2008 | 2.2% inflation
$100 in 2007 = $102.60 in 2008 | 2.6% inflationStatistics Canada – Consumer Price Index Nov 2008
Inflation was approaching 4% on an annualized monthly basis solely because of energy prices. Deflation is defined as dropping prices, but is it just because of dropping energy prices, and is that a bad thing? Should we bail out the oil companies now?
Thoughts from any armchair economists welcome.
Inflation isn’t just what the Bank of Canada says it is. First article to mind is in the Globe, but it’s not a new idea:
http://www.theglobeandmail.com/servlet/story/LAC.20071201.STBUYSIDE01/TPStory/TPBusiness/?query=
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December 2, 2008 at 5:48 pm