This culture of stripping down of the cost base through similar activities described by Chris has had a deflationary pressure on prices. In my view, the deflationary effects of that culture played a role in justifying the loose monetary policy over the past decade.
Globalisation, automation, size-flation and races to the bottom with respect to quality. It effects many goods and services, but not all. For example, can we say these hit the property sector since the Great Recession? Probably not.
The basket of goods making up the inflation indices are a mixture of what has been hit by this phenomenon and what hasn’t. So in aggregate we have had deflation in some costs and inflation in others.
Lots of really cheap flights and cheap clothing to bring with you but no roof over your head when you return.
Sadly accurate😢
I agree, and the effects go further.
This culture of stripping down of the cost base through similar activities described by Chris has had a deflationary pressure on prices. In my view, the deflationary effects of that culture played a role in justifying the loose monetary policy over the past decade.
Globalisation, automation, size-flation and races to the bottom with respect to quality. It effects many goods and services, but not all. For example, can we say these hit the property sector since the Great Recession? Probably not.
The basket of goods making up the inflation indices are a mixture of what has been hit by this phenomenon and what hasn’t. So in aggregate we have had deflation in some costs and inflation in others.
Lots of really cheap flights and cheap clothing to bring with you but no roof over your head when you return.
Thanks Sean, good point about the effects on deflation. And how this is not economy-wide.
It seems Norman is still around: https://en.wikipedia.org/wiki/Norman_Tebbit
My sincerest apologies to Me Tebbit.
Mr Tebbit.