Wouldn’t it be good for the currency if we slowly steadily moved into deflation and at the same time lower the wages. Then the consumers wouldn’t have too much power, right? Or would it be a global perspective problem?
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Slow deflation?
You mean, death spiraling deflation. Modern economix tools (namely interest rates and money policy) do T work in deflation, because you can’t lower interest rates below zero. While if expectations are for lower prices in the future, consumers, who in the US at 75% of growth, delay purchases on hopes of lower prices. Selling goods and services at lower prices means slowing or stopping production. Meaning layoffs / firing. So, wages for some consumers goes to zero, too. And repeat.
Some inflation, 2-4% is always preferred because things are growing, progress is happening and wages rise along with prices
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