Japan has been struggling with deflation (=decrease of prices) for a good 25 years now… you really don’t want that happening. Ideally you want something around 2% inflation.
You also shouldn’t purchase, since goods will get cheaper over time. Also don’t take loans for the same reasons. Basically you should take your money in cash and sit on it.
Those are considered inelastic goods, yes. They are also way too small an amount to keep an economy going. Most things we spend money on aren’t like that, and demand going down like so will affect markets; companies not producing necessities or for export will fold if it lasts too long, etc.
Japan has been struggling with deflation (=decrease of prices) for a good 25 years now… you really don’t want that happening. Ideally you want something around 2% inflation.
What are the issues with deflation other than that people wouldn’t want to invest in whatever is available?
You also shouldn’t purchase, since goods will get cheaper over time. Also don’t take loans for the same reasons. Basically you should take your money in cash and sit on it.
That falls apart with necessities like food and medicine, doesn’t it?
Those are considered inelastic goods, yes. They are also way too small an amount to keep an economy going. Most things we spend money on aren’t like that, and demand going down like so will affect markets; companies not producing necessities or for export will fold if it lasts too long, etc.