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Investing Specialists

Falling Prices: Too Much of a Good Thing?

Falling prices are generally good for consumers, but is the U.S. moving into the deflationary world of Japan?

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Overall, it was a bad week for equity markets and a better week for bonds as markets began to anticipate slower economic growth in both the U.S. and abroad.

The week got off on the wrong foot with China reporting slower-than-expected growth. (It was still 7.7% in the first quarter, down from 7.9% the prior quarter amid expectations of 8% growth.) It didn't help that a German Central Banker, who is also a governor of the European Central Bank, said it might take Europe 10 years or more to dig out of its mess. He also noted that member countries should stop counting on the Central Bank for relief.

Robert Johnson, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.