Relativity applied to financial reasoning.
The fisher equation, as the definition of the real rate, can be rewritten isolating inflation as the Nominal Rate minus the Rate, the real rate must exceed the nominal rate to achieve deflation.
Spell this out for me, please.
sorry about the wording, it's just a simple algebraic operation.
real = nominal - inflation
so
nominal = real + inflation
in order to have inflation less than zero, real >= nominal.
The fisher equation, as the definition of the real rate, can be rewritten isolating inflation as the Nominal Rate minus the Rate, the real rate must exceed the nominal rate to achieve deflation.
Spell this out for me, please.
sorry about the wording, it's just a simple algebraic operation.
real = nominal - inflation
so
nominal = real + inflation
in order to have inflation less than zero, real >= nominal.