• Bye@lemmy.world
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    1 year ago

    There was never a world where we would deflate back to any reasonable dollar value.

    The stock market cannot handle deflation, as it would be more valuable to hoard cash than to invest. So the rich would lose tons of value.

    Almost nothing will ever really get cheaper.

    • TipRing@lemmy.world
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      1 year ago

      The main issue is that wages haven’t really kept up with inflation and the fed is actively driving unemployment to force wages to remain low. This results in real loss to anyone whose income doesn’t primarily come from their portfolio.

      • SCB@lemmy.world
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        1 year ago

        actively driving unemployment

        Holy shit someone should tell the labor market, since it’s competitive as fuck right now.

        Weird that none of this “driven unemployment” is showing up anywhere.

        • TipRing@lemmy.world
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          1 year ago

          A cooling job market is likely forstalling further rate hikes this year. Feel free to have your uninformed opinion but the fed has stated that the purpose of rate hikes is to relax an inflexible labor market, which means increasing unemployment.

          • SCB@lemmy.world
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            1 year ago

            Fed is hiking rates to make borrowing less attractive which hurts new job growth and limits expansion.

            The inflexible labor market is a result of demand for labor vastly exceeding supply, largely due to shitloads of people cashing out and retiring during COVID, and the Fed is getting that closer to parity.

            I say “getting closer to parity” because we’re still adding hundreds of thousands of jobs per month on net in a market that is as favorable to labor as any in around 80 years.

    • Cleverdawny@lemm.ee
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      1 year ago

      The problem with deflation is that it encourages saving rather than consumption, leading to an economic depression.

    • SeaJ@lemm.eeOP
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      1 year ago

      The rich would be perfectly fine. People taking out loans would be screwed.