Nobody is going to give hungry because food will be cheaper next year. Nobody is going to go homeless because rents will be cheaper next year. Even if doing nothing is a good strategy, humans aren't going to do nothing because our time on earth is finite and we hate saving.
Even in an inflationary environment the rational thing is not to consume, but to invest in investments where the expected return beets inflation.
From the perspective of the wealth (who account for most consumption) we have effectively been in a deflationary environment as their investment returns consistently beat inflation
why did you say that “we have effectively been in a deflationary environment as … investment returns consistently beat inflation”? do you understand why thats an oxymoron? if you have to invest your money in order to beat inflation, then by definition you are not in deflation. deflation is when you can realize gains without investing your money.
(lol this sub shows a warning when you type “oxymoron”)
Effectively been in a deflationary environment does not mean there has been 0 period of inflation. My bad for trying to introduce nuance. I forget how simplistic you guys are. No wonder you cling to your simply economic models and bury your heads rather than acknowledge any economy that did go through long periods of inflation without experiencing the same outcomes your models predict
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u/thevoidthatjerksback 8h ago
I doubt that anyone could explain this in a way where I would accept deflation as worse