Why you should watch this interview with tech entrepreneur turned author (“The Price of Tomorrow: Why Deflation is the Key to an Abundant Future”), Jeff Booth:
- Technology is driving costs lower and productivity up, creating a potential world of abundance. (Think about how many screens you have in your house compared to your parents’ house.) However, it is also creating immense deflationary pressure, which is intensifying.
- The side effect of improving technology is that many jobs are being automated and made redundant. Your job and your children’s jobs are at risk, while the few at the top reap the benefit.
- For decades, central banks have attempted to compensate for deflationary pressures by growing money supply by vast amounts. Most of this new money has flowed into financial assets, resulting in asset price inflation. Owners of financial assets gain, but these owners are disproportionately the wealthy. Yes, many people have 401ks, RRSPs and pensions, but their proportion of financial asset ownership is small. However, asset price inflation has not improved the lives of the median household.
- What we’re left with is a divergent economic experience: “the many” lose because they’re made redundant and don’t own assets to a large extent while “the few” accumulate the gains generated by technology and asset price inflation. This has increased wealth inequality over time and will continue to do so.
- Society increasingly becomes polarized and susceptible to charismatic leaders who promise solutions without actually addressing the fundamental problem. Often these leaders stoke the smoldering fires, causing people to turn on each other. Then they may turn on ‘outsiders’, however defined. The end result: revolution and war.