On the other hand, the poor want to spend but have no money, which gradually leads to excess production capacity in the market. This causes companies to start competing in a race to the bottom, driving profits to dangerously low levels, which sets off a vicious cycle. As company profits decrease, they scale back and lay off employees, making the poor even poorer, and savings become too risky to touch.
Poverty is indeed a problem that is quite difficult to overcome because there is no best ability for the government to solve this problem. But further you try to describe the conditions of poverty and indirectly blame the condition because the lack of purchasing power of people who are categorized as poor which makes companies eventually reduce production of goods and lay off some of the employees who work. The economic situation is not as easy as you say and maybe the arrival of recession conditions is not only caused by problems like the ones you talk about.
In certain cases, companies will take policies against the process of decreasing production value and automatically policies must be taken to protect the company. So if it is associated with poor people and companies that eventually have to lay off their employees, it is wrong in my opinion.