The Upcoming Deflation Dilemma
Everyone is looking up when down is the direction. When will this happen is impossible to guess. However, just like everyone was expecting a year end run in cryptocurrency, the market went down. Markets tend to do the opposite of what the masses expect.
In this video I discuss the number 1 indicator that we have deflationary pressures ahead. This is overlooked by most but it is build into the formula.
▶️ 3Speak
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@pixresteemer(6/10) gave you LUV.
The FED is basically printing money for the elites/banksters, isn't it?
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It is informative content. Thanks.
Summary:
In this video, Task discusses the misconception surrounding deflation and inflation in the current economic scenario. He argues that the Federal Reserve's money printing isn't solely responsible for inflation, attributing it more to the global supply chain disruptions caused by the shutdowns due to the COVID-19 pandemic. Task highlights various deflationary factors like technology advancements, autonomous systems, and changes in work habits, emphasizing the impact they have on spending patterns, wages, and the velocity of money in the economy. He stresses that without an increase in the velocity of money, inflation might not be sustainable in the long term, pointing to Japan's prolonged deflationary spiral despite massive quantitative easing efforts.
Detailed Analysis:
Task starts by addressing the common belief that the Federal Reserve's money printing and central banks' policies are driving hyperinflation. He challenges this view by pointing out that the current inflation surge is more a result of supply chain disruptions stemming from the global shutdowns during the COVID-19 pandemic, rather than the excess money supply. He questions the sustainability of this inflation trend, emphasizing that inflation may not persist in the long term due to various deflationary factors at play.
One key deflationary factor Task mentions is technological advancements, such as autonomous trucking, robots, and robotic process automation (RPAs). He explains how these innovations reduce costs and drive efficiencies, leading to deflationary pressures in the economy. Additionally, he highlights the shift in work habits, particularly the increase in remote work post-COVID, which has altered spending patterns significantly, thereby impacting inflation dynamics.
Task also challenges the common perception that wage growth leads to inflation, citing historical data from the Great Depression in the 1930s to support his argument. He argues that while wage growth may benefit some workers, overall wages across the economy can still decrease due to reduced work demands, ultimately affecting the velocity of money and inflation levels.
The concept of the velocity of money plays a crucial role in Task's analysis of inflation trends. He stresses that stagnant money flow in the economy can hinder sustainable inflation growth. Task cites the example of Japan, where despite extensive quantitative easing measures and fiscal spending, the economy has remained in a deflationary state for years due to persistently low money velocity.
In conclusion, Task warns about the potential deflationary pressures ahead, pointing to various economic headwinds like weakened service sectors and declining consumer spending. He cautions that without a significant increase in the velocity of money, sustained inflation may not be achievable, and the economy could face turbulent times ahead.