Try and think of our global system as an engine that's purpose is to make fuel for itself. It needs to keep it's input above the output in order to keep powered on. As soon as the input drops below output the machine starts to slow down and can no longer sustain itself. The engine is not designed to slow down so it very quickly breaks down
If prices are going down, might people wait longer to buy something?
If many do that, might that lower the amount companies can charge for those things?
That reduction of prices is (if widespread) more deflation, making people hold onto their money more tightly. That's a deflationary spiral.
At some point, the market prices drop to/below production prices, and those firms will have to shut down, their employees will be out of work, and those products will not be available.
While the unavailability is the system recovering, it's a terribly destructive mechanism, and setting up new firms/factories/etc. will be rather more expensive than if the firms had survived, so as a consumer you'll find that availability of goods collapses and then correcting that situation requires significantly higher-than-original prices.
Massive disruption, little real cost reduction for you, and a good chance that you lose your job.
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u/IrksomFlotsom 8h ago
Try and think of our global system as an engine that's purpose is to make fuel for itself. It needs to keep it's input above the output in order to keep powered on. As soon as the input drops below output the machine starts to slow down and can no longer sustain itself. The engine is not designed to slow down so it very quickly breaks down