Divirtualigente: Anti-Inflationary Technology

Technology as an anti-inflationary agent and transformer of recessionary flows. 

Indeed, Do we know what inflation is? Who is impacted by inflation? Inflation is increasing Wages? Inflation is related to products demand? Is inflation the real value of money? Do we know it's a recension? Who benefits from the recession? Recession depends on inflation? Recession is correlated to gross domestic product (GDP)? Is the recession to blame for interest rates? Does speculation create recession? Does speculation generate poverty? Does speculation close businesses and jobs? Are recession and inflation part of the Polarization© economic model? 

The data. The Great Economic Depression of the years 1929 to 1939 in the United States was caused by the fall of the stock market. Wall Street panicked and ended up disappearing the funds of millions of investors. The money flow, used for consumption and GDP growth, declined terribly forcing the closure of companies and the fall of industrial production. The average unemployment rate was 20% per year. In 1933 it reached 25%. Under these conditions; more than 50% of businesses closed and half of banks went bankrupt, creating a lack of money flowing into society's pockets. But, what was the root cause? 

The Polarization© model: The model integrates, among several of its systems and structures, two archetypes. The first refers to the interdependence between the wage and the direct purchasing power of acquisition or consumption of the worker. It is define as "function of the direct cycle of the wage-consumption market". The second establishes the "factor orientation and position of money flows". This refers to the multiplier tensors function such as: sales prices, wage index, production and cost indices, utility factor, interest rates, value creation index, taxes, speculation degrees, goods and services value add and others ones, that impact the relationship directly with the orientation and location of money flows. The formula is shaped by these two functions to determine the degree of economic polarization© in general.

The facts. Applying the Polarization© model to the US recession, the following arguments are established. The orientation and position of the money flow factor, shows, that the money was located into the stock market instead into the sector of making goods and services. Also, the investments based on false profits due to money market speculation – fake money – grew in comparison with the production of goods and services; collapsing the system. Wall Street's unrealistic gains were greater than the value add market. This fact, diverted the money flow from pockets to pseudo-investments destroying the wage-consumption cycle. Loans and interest rates generated a lack of money and payment capacity, creating the disappearance of banks. The speculative value of investments, in some cases, were transformed into real assets by some financiers and safeguarded. Those who could not do this transformation, regrettably lost everything. Finally, the presence of a recession is based solely on the speculation effect.  

The contradictions. Are we currently living with inflation and possible recession as in the depression age? In fact yes and no. What is evidence; that an interest rate increase creates a recession in short time that will impact GDP, but inflation index. Why? The model justifies this based on an independence between the relationship of the natural wage-consumption cycle and the money flow factor. Currently the pockets have money to accomplish the arguments of the wage-consumption model in comparison of the value flow factor that still of lower. If rates continue to rise, they will affect total GDP and not inflation. If there is an inflation, there is no recession. If an interest rates increase, it will appears a recession but inflation.  

Technology. The Polarization© model is based on technological and digital knowledge with the spirit of the maximum. It evaluates the order of economic, financial and social statements, based on growth, inflation and recession among others. The structure begins with the definition, collection and protection of information, analytics and data science, mathematical modeling, simulations and artificial intelligence. Its main benefit; is to define the degree of the wage-consumption cycle, the factor of orientation and location of the money flow and avoid speculation. Finally about the inflation, the Polarization© model recommended not to increase the interest rates; instead, produce more goods to offer into the market. The higher is the offer and supply, the lower is the inflation and avoid recession. This is the key.