Deflationary Risk - Anyone Spending?

[wartrace]

Im hardly spending on anything now but utilities/services. Haven't left the compound in the past two weeks other than my daily walks.

 

[Sig]

close minded people like yourself deserve the forever struggle... enjoy it then...

I am here to salvage the poor souls in the trading hell yet so many just rather stay in hell.... so ok.

Tinfoil hat conspiracy theorists deserve to not be the miserable souls they are. I wish you luck joining the rest of us in the real world.

 

[Handle123]

No different for me except drive thru Starbucks, why people use this when store was open before, I don't get it. Bought Smart phone and GPS, smaller underwear, LOL and just normal purchasing. People need jobs, so reduction in buying what is normal, might cost jobs. Cleaning up storage unit, don't have an excuse now. But if I see a deal, am on it. Wear mask before I am in the car, this way I can curse at all horrible drivers whereas before, not as much.

 

[apdxyk]

I hear that Apple quietly introduced a cheap iPhone?

 

[piezoe]

I've had the same $20 in my pocket since Friday. I haven't spent a penny in five days.

Anyone spending? My friend won't even go to McDonald's because he fears food handling may spread germs.

I see the demand-size shrinkage and deflationary risk in this situation as mammoth:

- During the shutdown, peeps will not spend because they can't--stores are closed! It effectively forces prices to zero! Also, peeps and companies alike are also holding tightly to cash.
- After the shutdown, peeps will have gotten used to living without a lot of stuff. There will also be a contraction and long recovery. To restart the world economy is like moving an aircraft carrier... it will take a tremendous amount of power to get it going.

The deflationary risk in this situation is shocking.

The trick is to balance the deflationary forces you mention with inflationary forces. An inflationary force is money printing and easy credit. Ideally we will print just enough money to balance the deflationary force so we will end up with neither deflation nor inflation. It seems the central bank has been pretty good at this. will see now how good the Powell led bank is. The stimulus (rescue) programs you hear about are the way the printed money makes it into the economy.

In the long run what matters is the ratio of money (I include credit in money) to productivity. What is happening now, in addition to the other things, is a significant drop in productivity, isn't it? That could lead, over the longer term, to inflation, if the money supply should become to large relative too productivity. I don't think that will happen as the main problem for many families at the moment is just putting food on the table and keeping a roof overhead .

 

[piezoe]

it is completely valid to point out the 'subject at hand' is invalid.

But is it? I may not be valid to you personally depending on your situation, but deflation or inflation can affect the living standards of million of Americans.

 

[JesseJamesFinn1]

I've had the same $20 in my pocket since Friday. I haven't spent a penny in five days.

Anyone spending? My friend won't even go to McDonald's because he fears food handling may spread germs.

I see the demand-size shrinkage and deflationary risk in this situation as mammoth:

- During the shutdown, peeps will not spend because they can't--stores are closed! It effectively forces prices to zero! Also, peeps and companies alike are also holding tightly to cash.
- After the shutdown, peeps will have gotten used to living without a lot of stuff. There will also be a contraction and long recovery. To restart the world economy is like moving an aircraft carrier... it will take a tremendous amount of power to get it going.

The deflationary risk in this situation is shocking.

Same here, all my greens would need sunglasses after the dust and moths are removed. No avocado toast for several young people I know either(kidding). Their learning to do with less and cook at home! Cooking gadgets selling which is bad for eating out.

 

[piezoe]

you are missing the point I just made... partially at least.

living standards, at its core, depends on the abundance or the lack of goods of services... so as long as there is enough lubricant to make the economic machine run to produce abundance, and technology keeps upping the workers' productivity, the living standards will always go up.

so what if CPI PPI goes up or down a bit, income can adjust up down as well.... you don't eat CPI, you eat real food, priced by the market, with your income.

sure there will be effect on savers vs. risk takers, that's why I said 'partially'.

While your post above makes sense, I am having difficulty relating it to your original post below. It is rather clear you have some point you'd like to make not related to the subject of this thread. You might be channeling the thought that "America was built on cheap labor," without realizing it. But if that's so, what does it have to do with this thread started by Kmiklas?

Your original post:
deflation, inflation, blah blah... all smoke and mirrors.
what is at the core of this whole game - masters and slaves.
does it matter what gadgets are priced at? as long as the slaves are working, to produce goods and services, and earn some food on the table, they are happy and the masters are happy.
that's the beauty of the modern money theory, everything is flexible, infinite liquid is always ready on tap... no problem whatsoever.
CPI, PPI, who cares... infinite print = infinite price..
the masters are gonna pretend they care about inflation/deflation... they don't....
what they care about is that the slaves don't stop producing and don't start a revolution.