Let me guess, deflation disincentivizes consumption so it can lead to a feedback effect that leads to recession?
Pay and wages tied to the rate of inflation would probably preferable; I’m sure congress will get right on it…
this post was submitted on 03 Dec 2025
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Lower prices incentivize consumption though, right? It definitely hurts profits, but people buy lots more pointless shit if they can afford it.
Static lower prices might, but deflation does not. If prices will be lower tomorrow or next week, it's wiser to hold on to your money and buy later.
Sounds good in theory, but I don’t think that holds up in practice. For example, computers getting more affordable and powerful year by year didn’t stop people from buying them.
If the price is lower than the opportunity cost of NOT having it, people will buy it now, even if the product will be priced better next year.
And a large part of the price increases people are struggling with are food and housing. It's not like you can wait till next year to eat or have a place to live.
It’s not like you can wait till next year to eat or have a place to live.
Eat? No waiting. Live? Sure! If prices were consistently falling because of deflation, and you knew renting for a year would allow you to buy a larger house with the exact same amount of money you hand in your hand, most would do that and rent for a bit.
For buying a house, isn’t it kinda like the stock market (except way less liquid). Yeah, the prices may go down in a year but someone may swoop in and buy while you’re sitting on the sidelines trying to time the bottom.
A specific house may be bought up, but others will be available that are similar for substantially less in a deflationary market.
Which would put inflationary pressure on rental prices which in turn would put inflationary pressure on property prices, and we are back to square one.
You're absolutely right. The average Joe does not approach buying stuff with any kind of investment theory.
In practice, deflation always leads to recession.
As to computers, the price didn't go down, we just got more bang for our buck, different thing altogether.
Sounds good in theory, but I don’t think that holds up in practice. For example, computers getting more affordable and powerful year by year didn’t stop people from buying them.
It absolutely delay people buying. If you held out for 6 more months, you'd get a substantially faster computer. Thats the second variable you're introducing with this example. If your current computer was "fast enough" you'd wait, and people did.
This is my problem with economics. You're talking about theory and practice as if they're the same thing. All consumers do not make perfectly rational choices. Hell, most don't. This kind of theory only explains how rich people want you to think things work. It's not how things work in the real world.
This is my problem with economics. You’re talking about theory and practice as if they’re the same thing.
Way back when, I used to sell computers and computer parts at retail. I assure you this was a regular conversation topic. "When is the Voodoo 4 graphics card coming out? 4 months? Okay I won't buy the older Voodoo 3 now because I can make do with my Nvidia TNT2 until then."
All consumers do not make perfectly rational choices.
No they don't, nor or do they need to if you're taking a macro view.
Hell, most don’t.
Are you saying:
- consumers NEVER make rational choices?
- consumers don't make 100% rational choices 100% of the time a choice is available?
I disagree with the former, but I agree with you on the latter. None of that invalidates micro or macro economic theory.
This kind of theory only explains how rich people want you to think things work. It’s not how things work in the real world.
Many rich people get rich because this works. They also play dirty tricks to create the situations, but then again in those situations the theory works.
I'll be the first to say economic theory is far from perfect and the deeper you go, the more complex, and potentially less reliable, it gets, but the basics are pretty sound.
An upgrade for a non-essential item you already own might prompt some of these considerations from some people. The decision to buy that item in the first place usually won't, especially when you're talking about essential items like groceries and housing, which is what the article in the OP is referring to.
It absolutely delay people buying. If you held out for 6 more months, you'd get a substantially faster computer.
That describes most of my life, under Moore's Law.
I handled it in the traditional way: I bought what I wanted, and then I immediately cussed about my shitty timing to my friends the next day.
only if you have money to hold to start with
But even if we could get relief on inflation, the prices wouldn’t keep decreasing by large amounts forever, right? It’s not like cars would eventually cost negative money and they pay you to take them. At some point the expected savings from waiting aren’t enough to justify the pain of doing without the shiny new thing.
It’s not like cars would eventually cost negative money and they pay you to take them.
While I accept your point, I feel conditioned to interrupt here and clarify that I absolutely would download a car. There was some unexpected confusion about this, at one point.
Okay. Carry on. Thank you.
Do people really do that? If lettuce got back in the range I was used to paying before, I feel like I'd start buying it again as soon as I noticed.
I mean, I'm perfectly fine with high prices as long as wages rise faster then the prices do...
Tomorrow's article, "New trend among corporate America: Vibe volunteering allows companies to augment staff with enthusiastic citizens who simply want to work without any recognition"
This is exactly how they're going to spin slavery when they eventually succeed in bringing it back.
Cough convict labor cough cough.
It's not even lower prices, it's more "not increase much faster than salaries".
You ESPECIALLY don't want that, and the reasons will shock you!
But there are reasons why you shouldn't reason for the shocking reason because of....reasons.
No, they will literally shock you into submission. The cops all have Tasers.
Financial obesity is an existential threat to any society that tolerates it, and needs to cease being celebrated, rewarded, and positioned as an aspirational goal.
Corporations are the only ‘persons’ which should be subjected to capital punishment, but billionaires should be euthanised through taxation.
Bloody well said mate
I mean, we already know that WaPo is the mouth piece for Baldy Bezos.
I'm fine if the prices stay high, as long as my wage is increased the same amount.
They won't do that either so....
I'm sure the argument is wages. Lower prices means lower wages or less jobs.
Except... 1. not really, not in the long term and 2. it happens anyway
What the what? Seriously? I've never in my life, thought you know what, I'd like to pay more money. This is true of rich or poor.
I did once for an artistic creation that exceeded my expectations. Rolled back and gave them an extra 80%, told them to raise their prices because they were cheating themself
This is what happens when billionaires are allowed to exist
The washington post is run by Israeli genocide apologists. Stop giving them attention.
I'm not a billionaire and I don't want lower prices. I want an income, and I want higher prices overall, with some pockets of price stability on stuff like housing and locally grown vegetables. Housing and local vegetables (in some areas) are very rare examples of things that have gone too far with price increases. Prices on most things are too low due to anti-environmental subsidies.
I want a society that subsidizes protecting the environment, not destroying it. I want the cost of my phone to help cover cleaning up after the factory that made it, instead of having the cost of my house and food help cover cleaning up the news headlines about pollution.
I want my phone to be $5000 and last 10 years while the cheapest shittiest phone that lasts 1 year still can't be less than $4000 (due to taxes) so that everyone saves up for 10 years to buy the $5000 phone and nobody fucking bothers making shit that only lasts a year.
And I want to pay for my phone in the transaction where I buy the phone, not in other transactions where I comply with a housing system that keeps others homeless and some of my money goes towards stuff like phones and shipping routes for them.
And as long as I have no income, all prices are too high for me to begin with, so it's all a moot point if you're not going to let me have an income.
Bro/sis, before the tariffs I was able to build a mid end PC for $1000, it does way more than a smart phone. There is no logical reason why a smart phone should cost $5000. You're getting down voted because the numbers you are throwing out are completely disconnected from reality. Manufacturing costs for a smartphone are like $500 tops. Another source on manufacturing costs. The actual people assembling them make something along the lines of $3-4 an hour, and that's being generous.