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To: expat_panama

The wages being cut thing really confuses me...

Why would deflation cut my wage that I already earn in salary arbitrarily, but at the same time as inflation goes out of control I seriously doubt my company will randomly tell me one day “Hey due to inflation here’s a 30% raise” I don’t see that ever happening.

By the same token it shouldn’t happen the other way... or is it we should just expect that the CEO is always so dastardly that they would cut due to deflation but never raise due to inflation? If so, then they are both worse than each other and 0% moving is the only thing we should aim for, so a raise is a real raise.


59 posted on 10/24/2014 6:02:46 AM PDT by Individual Rights in NJ (I don't even know what to say anymore..)
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To: Individual Rights in NJ
Why would deflation cut my wage

Sometimes it's automatic as some firms tweek wages yearly for the cpi.  Tweeking up is easy but tweeking down is different, what some economists call 'sticky' prices that don't move easily like say, food prices.  When employers lower wages they cut benefits or they lay folks off, delay raises, and then hire new workers at lower rates. 

Deflation is lower prices -including the price of labor.

62 posted on 10/24/2014 6:47:04 AM PDT by expat_panama
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