Here in Europe (Netherlands) many offline retailers went bankrupt during covid and it continues up to this day. Many small online retailers also suffer from having to compete with giants such as Amazon. Without any protection from the government. I suppose many see it as evolution; survival of the fittest and the ones who can adapt will survive. And like my previous boss you're really unlucky if you opened two stores just before a pandemic hits.

I hope this reply is on-topic enough.

A depressing assessment of what is going on but one I can't find anything I disagree with. I would add that a serious consequence of the trends you highlight is the increase in the rate of alienation from nature of younger people, many if not most seem to be suffering from technology addiction.

The dehumanization impact of technology. It began when science started to treat humans as computerized robots. Humans have lost their way and meaning. Now it is all about debt, consumption, and serving the ownership class. Humanity is lost in the wilderness. Do you want to change direction? Forget about consumption and turn your eyes toward care and kindness. The technological world cannot survive in a world of human emotions. It is dead. We are alive.

Now that COVID-19 is coming to an end — Shawn

You mean when? End of this year? Maybe that third wave at least in Europe still? Let's hope you are correct.

and new economic trends are arising — Shawn

Let's see what they are… besides a rampant speculative bubble in the markets thanks to asset inflation.

what will likely happen in the near future due to these tendencies in the economy arising and being enhanced by further more intelligent AI. — Shawn

Let's start from the beginning.

The deflationary impact of technology and price competition isn't anything new.

This happens especially when some technology is rather new and basically just "taking off" with rapid advancements being made througout the young industry. Yet this also happens in areas where the technology isn't going forward in such rapid pace too. Just compare, just for example, modern cars of this year and compare them with cars 50 years go (from 1971). Then compare those cars from 1971 to those of fifty years earlier in 1921. In both examples the features of the most luxurious and "high tech" cars of the earlier era have become totally normal in your average cheap family cars of the later era. And likely the tech has surpassed them making the newer cars far easier to drive and far more comfortable and safe.

Ford Fiesta 2021:

Ford Taunus 1971:

Ford T 1921:


In fact, just to start or drive a Ford T-model from 1921 and change it's gears would be extremely difficult for a modern ordinary driver without any instructions. Yet I would make one important question here:

Is this truly a "deflationary" aspect of technological advance? Is to correct to call it "deflationary"?

Or is there still the basic utility behind the product, be it a car or something else, that has stayed the same? Driving to work with either a 2021 Ford or a 1971 Ford or even with the 1921 Ford is still the same thing: you drive a car to work. This is an important question as the "deflationary" aspect of technological advance is statistically used to lower inflation: your 2021 Ford Fiesta is so much better than 1971 that the statistician can argue that inflation hasn't been as great as the prices of 1971 and this year would tell you.

So, what are your thoughts? — Shawn

I think it's a way to hide inflation and distract people from the reality: to say that since your gadgets are so much more awesome now than yesteryear, hence inflation hasn't been so high. And better yet: you have "deflation" when the prices are down and the gadgets are more cooler! For the central bankers and the upholders of the fiat monetary system this is important. It serves them well, especially during a time when income inequality is going through the roof.

And just for those that are interested: a Model-T Ford cost 325$ in 1921. I don't know how much a Ford Taunus (manufactured in Germany) cost in 1971, but your average car cost then perhaps about 3500$. Ford Fiesta costs something like 15 000$, which is way more than just 3500$ in 1971 money calculated by CPI to present money (which would be like 9 000$). So to make the case for there being less inflation, you make the argument that your Ford Fiesta of today is so much better than the Ford Taunus of 1971.

Where a unit of a good is defined much more precisely in digital goods, and the brand of a product doesn't influence the quality factor of the good, then the effect of deflation is more apparent in sum total.

I'm not sure cars are a good example, due to the variance and band effect on the final good.

It's interesting that with strict economical analysis of such mercantilist firms like Tesla, that this becomes more apparent.

I just had to say that I much prefer, and only drive, old cars - as little technology as possible!

What are your economic forecasts of consumer behavior or economic tendencies due to the above information provided? — Shawn

Less ownership for long-term assets like homes, I guess. Portable consumer technologies might have already replaced the old-fashioned pride -- as long as there are good internet connection, unlimited data, and affordability of computers and cell phones.

Also, the trends in dwelling have moved towards simpler, smaller, cheaper alternative: moving back home to parents, living in cheaper neighborhoods, or renting or buying cheaper apartments or houses. It's the always-connected to social media and people that has become the standard. No longer do people feel deprived because of lack of expensive possessions, but a lot of people couldn't care less what brand of clothes or shoes people wear.

I just had to say that I much prefer, and only drive, old cars - as little technology as possible! — Photios

I remember this professor of economic history who preferred cars manufactured earlier than one specific year in the 1970's. That was the year when the first crude computers and electronic gadgets were introduced to cars. With cars before that year he could repair himself everything. (Which of course today would be a horrible blasphemy for car manufacturers...if people could do that.)