A Question I Can Answer: Why Is the Speed Limit on Deflation so Low?

Nick Rowe asks:

Worthwhile Canadian Initiative: Re-learning the New Keynesian IS curve: [A:]n empirical puzzle for New Keynesian macroeconomists. If macroeconomic black holes of deflationary spirals exist, and if bad monetary policy can cause economies to fall into one, why haven't we ever observed this happening? Does somebody up there like us? (At least, until now). Or is something wrong with the model?

The Akerlof-Yellen answer--which I think is correct--is that the expectational...