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The point is this might stop inflation in its track.

• somenameforme 4y ago
  I am not saying that this is the scenario but it's worth considering that the start of economic collapse from inflation tends to happen when companies have products to sell, but they can't afford to sell them for prices that people can afford to pay. This does not end inflation, but tends to exasperate it. The company goes out of business and you now have fewer things in the economy, but the same amount of money. The result is further inflation.
  • SoftTalker 4y ago
    But Target is likely not going out of business. Even if they have to sell stuff at a loss. And even if they did, their inventory would be auctioned off and resold, it would not just be chucked in a landfill.
    • somenameforme 4y ago
      I agree that they are probably not going out of business, though it may be closer than it seems. The article suggests they're now going to be running on a 2% margin after the clearance. Even if things get worse, they can probably afford to run in the red for some significant period of time (and perform various liquidations to get back into the black if necessary), but that's a quite unstable scenario. The issue with a retailer going out of business is not the retailer itself, but the manufacturers behind it. Target failing to sell their product reflects large numbers of manufacturers being unable to sell their product.