... "cheap" is the main metric consumers care about because whenever anything can be supplied for less, the Federal Reserve calls that "deflationary" and creates enough new money to make sure prices go up to erase those gains. So the cost of buying anything isn't bottom of the barrel keeps going up in real terms. Most people can afford to swim against the current in one product category, and some people [the affluent] can afford to swim against the current in many product categories, but most people cannot afford to swim against the current in most product categories.

▲

intended 3 hours ago | parent [-]

Dang it no! That isn’t remotely how deflationary works.

There’s always things being supplied for at lower prices. That is what product or service improvements do.

Your car is vastly safer than a Ford Model T. Air bags, better brakes, power steering, AC - all of which make it a vastly superior vehicle. If inflation worked the way you implied, the price of it would have constantly gone up, and never would it have managed to be affordable.

Firms reduce the cost of production and get to sell more to larger numbers of consumers. Total revenue = $ value * N customers.

You expand further on your position in the second part of your para, but that is fundamentally about how wages have not gone up over time. Which has nothing to do with inflation. It has MUCH more to do with the labor markets, and the pay people are getting for their labor.

https://www.investopedia.com/terms/d/deflation.asp

	▲	mindslight 2 hours ago \| parent [-]
		> Air bags, better brakes, power steering, AC - all of which make it a vastly superior vehicle. If inflation worked the way you implied, the price of it would have constantly gone up, and never would it have managed to be affordable. You're talking about something different than what I was - improvements that make a product better without the price going up (because the cost is small enough to become the new baseline, either by market stickiness or regulation). Those don't affect CPI, and therefore make life better at the same price. So I agree with where you're coming from there. My point is about the manufacturing/product innovations that make prices go down (regardless of whether quality gets better or worse). Take for example offshoring, which was sold as maybe your local factory will have to lay off some people but we will have less expensive items at the store so we will all win on average. But it's a trick because the Fed creates a feedback loop that makes it so prices cannot go down on average. Wages haven't risen as fast as consumer price inflation because that new money is injected into the financial industry (the fake "fiscal responsibility" of the Republican party). And when too much newly created money finally leads to too much demand for labor and wages start rising, the Fed then tamps down on the monetary creation.