It seems that the only silver bullet left to fight deflation will be high inflation. It looks as it is going to be a very very difficult pill to swallow.
Printing presses work overtime to save economy - Times Online
Printing presses work overtime to save economy - Times Online
An increasing number of economists are concerned that keeping the printing presses on overtime might trigger the sort of double-digit inflation and 20% interest rates that Jimmy Carter willed to Ronald Reagan. Paul Volcker, chairman of the Federal Reserve Board at that time, and now the head of Obama’s new Economic Recovery Advisory Board, undoubtedly remembers the pain inflicted by the inflation he had to wring out of the economy in the 1980s.
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