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Would a significant recession be necessary in order to have some deflation in prices?
Posted on 6/12/22 at 3:43 pm
Posted on 6/12/22 at 3:43 pm
Deflation is a pretty uncommon thing in modern times. Typically we see a reduction in inflation rather than an actual deflation of prices. Experts say that a very significant recession or even a depression would have to happen in order for true deflation to happen.
Would a recession be a necessary evil that needs to happen in order for prices to go back down and for people to get back to their former way of life? The Federal Government flooded the system with cash during the pandemic by issuing stimulus payments, issuing PPP loans, and having the Fed buy up securities from banks in order to lower interest rates.
Also, the lockdowns crippled our work force and our supply chains. These have never recovered. Companies can’t find employees because people won’t work anymore, and supply chains are still being disrupted by this.
How do we get prices back to normal and restore our former lives? Is a terrible economic collapse inevitable but also our only way out of this?
Would a recession be a necessary evil that needs to happen in order for prices to go back down and for people to get back to their former way of life? The Federal Government flooded the system with cash during the pandemic by issuing stimulus payments, issuing PPP loans, and having the Fed buy up securities from banks in order to lower interest rates.
Also, the lockdowns crippled our work force and our supply chains. These have never recovered. Companies can’t find employees because people won’t work anymore, and supply chains are still being disrupted by this.
How do we get prices back to normal and restore our former lives? Is a terrible economic collapse inevitable but also our only way out of this?
This post was edited on 6/12/22 at 3:44 pm
4
Posted on 6/12/22 at 3:46 pm to cbree88
I don’t think we will ever realistically see prices come down. Eventually jobs will have to compensate for the difference but it will likely take a number of years before we catch up. The only thing I see decreasing or leveling out in price is housing as it is unsustainably high and up 50% since Covid
Posted on 6/12/22 at 3:47 pm to cbree88
quote:
Is a terrible economic collapse inevitable but also our only way out of this?
I don't think so. We will enter a recession, but it doesn't have to be bad like 08
Posted on 6/12/22 at 3:48 pm to cbree88
Yes. If the fed was serious about undoing the mess they’ve made, they’d raise rates 2 full percentage points tomorrow, and unwind their balance sheet at breakneck speed. Instead they’re gonna pussyfoot around and do something radical once a Republican President is in charge, and then deflect it onto his administration.
Posted on 6/12/22 at 3:49 pm to cbree88
Something something pay people more.
Look at rental prices - those are never going back down and the days of renting an apartment for $750/month are long gone.
Did we see baggage fees disappear? No. Same thing with increased pricing - corporations are too greedy to adjust pricing down even after things stabilize and their costs go down
Look at rental prices - those are never going back down and the days of renting an apartment for $750/month are long gone.
Did we see baggage fees disappear? No. Same thing with increased pricing - corporations are too greedy to adjust pricing down even after things stabilize and their costs go down
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