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20th-July-2011, 00:26
#10
Reduction in the value of money tends to spur spending, because people realise that they can spend that $500 now and get $500 worth of shit or hang onto it and get caught with $500 thats now worth $200. The real killer on spending is deflation.
Of course, these phenomenons are well known and form part of the reason why government spending stimulus rarely takes the form of direct cash handouts.
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