Deflation, your fame is over

Matthew Lynn

In early 2003, talk of a decade of deflation spread much doom and gloom and dominated the economic headlines

Andy Warhol's famous dictum that in the future everyone would have 15 minutes of fame has become tediously familiar - and increasingly prescient. It applies, routinely, to pop singers, actors, novelists and politicians. Now we may have to apply it to economic theories as well. The first candidate for the academy of fleeting fame? Deflation. Earlier this year, we were inundated with dire warnings that this would be a decade of deflation. Prices were going to tumble, equity and commodity markets would be depressed, monetary policy would be useless, debts would become unmanageable, and so on...