Quote from: deisik on November 07, 2013, 04:08:16 AM

Quote from: ilpirata79 on November 06, 2013, 10:05:55 PM

This is not true, imo.

If I need something there will be always someone producing it. If the producer is worried about deflation (if any, that is to see) he/she will simply increase the price for the work ("transformation of raw material") he/she is making.
This process pushes prices up and counterbalances deflation leading in the end to stable prizes (everything else being constant).

Best regards,
ilpirata79

Under deflation prices are falling - by definition. What you say ("he/she will simply increase the price for the work he/she is making") breaks this definition, that's all. It does not matter if you need something, what actually matters is the price you are ready to pay for what you need as an "aggregate" consumer (not you personally). Again, under deflation you are not ready to pay the price the producer initially asks which forces the prices down (and leads to all ensuing devastating effects on the economy) - all strictly by definition

I talked about what he/she adds for his/her work ("transformation of raw material/components"). The final price can be less because he/she bougth such material/components at a lower price.

Best regards,
ilpirata79