In Spain, inflation is plummeting. If nothing changes, everything points to deflation next months.At first sight, the fact that prices fall could seem something positive. After all, we would have a higher purchasing power (if we keep our job).
However, if you think about it, you will see it isn't as good as it seems: would you buy something today if you know it will be cheaper tomorrow? Actually, you would buy your most pressing needs, but not a house or a sofa, for example. Other people would do the same and sales will take a nose-dive. So, more people would be fired (increasing the number of unemployed people).
Today, there are more than 3,200,000 unemployed people in Spain. Unemployment increased in 200,000 people last month: it means more than 6,600 people a day. What will happen if our economy gets in deflation?
James Wilkinson
2 comments:
Well done!!!
There are examples of these in Japan I think, but we, Europeans do not seem to learn the lesson from other countries. Maybe What happened in Japan is not relevant to us! Anyway, I'm not an expert on these issues but it, altogether, looks scary!
All this things sound weird to me! I do not really understand you ecocnomic system. I still remember my days when a jar of rum was three jars of molasses and gallon of milk two pounds of gunpowder!
I really don't know what to do now
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