Business Standard

Savers and spenders

Related News

 As the financial media continue to speculate about the possibility of deflation in the OECD countries, one interesting feature is emerging.

 The country already in the throes of deflation is of course Japan, where consumer prices have dropped 7 per cent since 1995, or roughly 1 per cent per annum.

 The next candidate for a general price fall seems to be Germany where inflation is at 0.7 per cent and is likely to fall further. The economy least likely among the big three to experience deflation, by common consent, seems to be the United States.

 It is interesting that Japan and Germany, in that order, are famously frugal and their savings get reflected in their traditional surpluses on the current account; in contrast, the US is notoriously spendthrift with a deficit on current account fairly close to 5 per cent of GDP in the current year.

 Clearly, spenders have an edge over savers in avoiding deflation! In a way, deflation is

Read more on:   
|
|
|
|
|
|
|
|

Read More

Shyam Ponappa: The SC and spectrum

Only the Supreme Court can rectify spectrum management in line with other resources, but all stakeholders can contribute

Most Popular Columns

Aditi Phadnis

Aditi Phadnis: Shiv Sena needs to go the 'rural' mile
Aditi Phadnis

If Uddhav Thackeray and the Shiv Sena want to hold on to their new base, they will have to listen to the voices coming from rural Maharashtra much more carefully

Arvind Panagariya

Arvind Panagariya: MSMEs - separating wheat from chaff
Arvind Panagariya

Do not look for easy interventions to help small-scale enterprises - carry out the reforms that will let them grow big

T N Ninan

T N Ninan: Convenient 'truth-telling'
T N Ninan

In the run-up to the Lok Sabha elections, Narendra Modi talked of a "Jayanthi tax". He was taken to be referring to Jayanthi Natarajan, the ...

Advertisement

Columnists

Hemant Krishan Singh

Hemant Krishan Singh: Different kinds of partnership
Hemant Krishan Singh

The quality and bandwidth of India's strategic ties with Japan, the United States, and China are not the same

B Dasarath Reddy

B Dasarath Reddy: Andhra yet to solve the land puzzle for new capital
B Dasarath Reddy

Govt has invited bids to choose a consultant to develop the new capital but there's no clarity on the location and source of funds

Steven Johnson

Steven Johnson: Ebola's information paradox
Steven Johnson

Modern society is vulnerable to the threat of a pandemic because of the global connectedness of air travel; yet, we can alert the world to ...

Back to Top