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>the actual value of goods and services in the economy is shrinking On this point, are you referring to goods that already exist but are in less demand (thus l
by indigochill 7y ago
>the actual value of goods and services in the economy is shrinking
On this point, are you referring to goods that already exist but are in less demand (thus less value)? Or that fewer goods are being produced, thus the total value of goods (supposing we assign some arbitrary value per good) is less?
- lisper 7y agoBoth. The value of services is shrinking because there is less demand for e.g. cruises, air travel, restaurant meals, concerts, sporting events, etc. This is partially offset by increased demand for non-perishables, but that is only a small fraction of what is being lost. And the total value of physical goods is shrinking because supply chains are being disrupted and so less stuff is going to be produced. There is a lot of time lag of course. This is all going to play itself out over a period of weeks if we're very lucky, more likely months, and possibly years. Interesting times.