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Re: General Theory Seminar --Savings and Investment


John O'Donnell wrote:

> However, with hyperinflation or its opposite [Yet to be seen?]
> hyperdeflation, the question of liquidity becomes a bit suspect.
> Liquidity during a hyperinflation is suspect because people
> can't get rid of it fast enough to contain losses and if there
> ever is a hyperdeflation because people would hold onto money as
> long as possible making it unavailable for trade.

As happened in Hong Kong in 1988-99 and in Japan for the last decade and even
now and in China starting in 1999.  People held back from buying under the
expectation that prices have not hit bottom.

Henry C.K. Liu
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