Deflation! Everyone's freaking out about it. Basically, deflation means you are getting poorer for a different reason than you were last month. Unless you don't have any debt or have liquid assets, an across-the-board decline in prices doesn't matter, because you can't afford anything and anyone who can will wisely wait for prices to go lower. Also there is no more money to borrow and if you have a European grandparent, this might be a good time to look into skipping town.

But here's how we'll be sitting pretty: Our paper is free! That's right, no liquidity trap for City Paper readers, because according to my reading of economics, unless we figure out a way to pay you to pick up copies, in a deflationary economy we can't lose money. In a month you might be able to fly to Sao Paulo for $4.95 plus a toy in its original packaging, but City Paper will be worth EXACTLY as much as it is now. And all those poor suckers standing around Washington Post boxes waiting for the price to go back down 15 cents, whaddya think they're gonna be reading? OH YEAH! Wait, put down that Examiner...

Photo by Flickr user fiveforefun