• About
  • Archive
  • Privacy & Policy
  • Contact
Dana Blankenhorn
  • Home
  • About Dana
  • Posts
  • Contact Dana
  • Archive
  • A-clue.com
No Result
View All Result
  • Home
  • About Dana
  • Posts
  • Contact Dana
  • Archive
  • A-clue.com
No Result
View All Result
Dana Blankenhorn
No Result
View All Result
Home A-Clue

Whip Deflation Now

by Dana Blankenhorn
March 18, 2021
in A-Clue, business strategy, economy, education, energy, futurism, innovation, semiconductors, The 1981 Game, The 2020s and Beyond, Web/Tech
0
0
SHARES
2
VIEWS
Share on FacebookShare on Twitter

Moores loreWhile most people my age remain scarred by the inflation of the 1970s, I’ve long known something they didn’t.

Deflation is the problem.

Technology is naturally deflationary. Moore’s Law, the idea that chips could get better and better faster and faster, also means more output of everything, for less money.

We’ve seen this with every recession of my career. In the 1980s, computing cut warehouse space and distribution jobs. After the dot-bomb of 2000, it came for middle management. After the Great Recession cab drivers, hoteliers and retailers were thrown on the fire.

The pandemic has squeezed 10 years of technology change into one, as business has been forced to adapt. A lot of these changes are permanent because they cut costs.

Most knowledge workers will never return to their offices. Schools and colleges are being forced to use online resources to increase efficiency. Malls may never re-open, replaced by online shops. Ghost kitchens cut the size of restaurants. Fintech is replacing banks and brokers with apps. Semi-autonomous cars don’t need drivers. Electric cars don’t need oil.

Efficiency piles on efficiency. Even credit card processing carries technology debt. Bank and brokerage settlements can be replaced by apps, value replaced by digital stablecoins, everything can be done on the cloud.


10000 billEconomic policy isn’t set up to handle deflation. Throwing money at bankers only increases asset prices. What’s needed is demand, which comes from the bottom up.  The American Rescue Act will create demand. A Build Back Better plan will create more.

Inflation will rise in 2021, but it will be a short-term thing, because technology will quickly create workarounds. OPEC knows its days are numbered. Whenever oil prices rise it creates opportunities for renewables. Once an engine is harvesting power from the Sun, the wind, or Earth’s fire, that demand never returns. Technology can find substitutes for lithium and rare earths. Even the cost of discovery itself keeps going down, thanks to mRNA, CRISPR, and clouds that support the work of scientists and engineers.

Deflation is the cost of Moore’s Law. The struggle to create new demand, and direct resources toward filling that demand, can save this planet if it’s done properly. The political turn of the last year won’t bring raging inflation, and that will accelerate the turn.

The only real source of inflation during the coming decade will be in brains. Human talent now is the gating factor to economic growth.

If you want to prosper, train your mind.

Tags: 2020scloud computingcomputer chipsdeflationeconomyinflationMoore's Lawtechnology changeterchnology
Previous Post

Adam Smith Was Wrong

Next Post

Who Writes, Who Reads, Who Buys Your Story

Dana Blankenhorn

Dana Blankenhorn

Dana Blankenhorn began his career as a financial journalist in 1978, began covering technology in 1982, and the Internet in 1985. He started one of the first Internet daily newsletters, the Interactive Age Daily, in 1994. He recently retired from InvestorPlace and lives in Atlanta, GA, preparing for his next great adventure. He's a graduate of Rice University (1977) and Northwestern's Medill School of Journalism (MSJ 1978). He's a native of Massapequa, NY.

Next Post
Who Writes, Who Reads, Who Buys Your Story

Who Writes, Who Reads, Who Buys Your Story

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Post

The Coming Labor War

The Insanity of Wealth

May 7, 2025
Tachtig Jaar Van Vrede en Vrijheid

Tachtig Jaar Van Vrede en Vrijheid

May 5, 2025
Make America Dutch Again

Make America Dutch Again

April 30, 2025
Bikes and Trains

Opa Fiets is Depressed

April 29, 2025
Subscribe to our mailing list to receives daily updates direct to your inbox!


Archives

Categories

Recent Comments

  • Dana Blankenhorn on The Death of Video
  • danablank on The Problem of the Moment (Is Not the Problem of the Moment)
  • cipit88 on The Problem of the Moment (Is Not the Problem of the Moment)
  • danablank on What I Learned on my European Vacation
  • danablank on Boomer Roomers

I'm Dana Blankenhorn. I have covered the Internet as a reporter since 1983. I've been a professional business reporter since 1978, and a writer all my life.

  • Italian Trulli

Browse by Category

Newsletter


Powered by FeedBlitz
  • About
  • Archive
  • Privacy & Policy
  • Contact

© 2023 Dana Blankenhorn - All Rights Reserved

No Result
View All Result
  • Home
  • About Dana
  • Posts
  • Contact Dana
  • Archive
  • A-clue.com

© 2023 Dana Blankenhorn - All Rights Reserved