Definition of Biflation

What is biflation? What is the definition of biflation? What does the term biflation mean?

Biflation is a fairly unusual occurrence that takes place when both inflation and deflation are taking place at the same time.

According to Wikipedia, the term "biflation" was coined by Dr. F. Osborne Brown back in 2002-03.

With biflation, certain assets increase in price due to high demand, while other assets drop in price.

The assets that increase in price are those that are commodity-based, such as food and energy. According to Dr. Brown, there is an "over-abundance" of money being injected into the economy by central banks, and much of this money is going towards the commodity-based assets.

On the other hand, deflation is also occurring in a "biflationary" environment as consumers stray away from non-essential purchases and "debt-based assets". This would expensive houses, equities, etc. The deflationary side would be caused by rising unemployment and decreased purchasing power.

Many people believe that the US is either in a biflationary environment right now, or that it will soon find itself in one.

Source: Wikipedia.org - Biflation

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