Debt Deflation

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August 31, 2024 4 min read Definitions
Debt Deflation: Economic Downturn due to Excessive Debt
Economics Finance Banking Debt Deflation Aggregate Demand Economic Downturn Financial Crisis Economic Theory
Debt deflation is a situation where excessive debt reduces spending and borrowing, leading to a decline in aggregate demand. This phenomenon typically occurs when individuals and firms cut back on spending due to high debt levels, contributing to economic slowdowns.
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