signs of deflation

I was wondering about this, is the wide spread adoption of the use of discount coupons a sign of deflation in our economy, all the supermarkets are at it and then you have the like of groupon, I recently used a deal for a hotel in Dublin ( a capital city ) which was very good value/cheap and included expensive drinks.

antoobrien

mariaalice wrote: »

I was wondering about this, is the wide spread adoption of the use of discount coupons a sign of deflation in our economy, all the supermarkets are at it and then you have the like of groupon, I recently used a deal for a hotel in Dublin ( a capital city ) which was very good value/cheap and included expensive drinks.

Is it a sign of deflation, no definitely not.

It is an attempt at generating business. I've seen discount deals for the likes of Dromoland Castle & the hotel in Fota that have to be used before mid march, which is not exactly high season for holidays, so any business they get will help cover their costs or reduce losses that they are hoping a good summer will cover.

And supermarkets have been doing discount coupons for years. If one is old enough, one might remember the groceries order was brought in during the 80s to prevent supermarkets selling bread (among other things) as loss leaders to attract business.

antoobrien

antoobrien wrote: »

Is it a sign of deflation, no definitely not.

It is an attempt at generating business. I've seen discount deals for the likes of Dromoland Castle & the hotel in Fota that have to be used before mid march, which is not exactly high season for holidays, so any business they get will help cover their costs or reduce losses that they are hoping a good summer will cover.

And supermarkets have been doing discount coupons for years. If one is old enough, one might remember the groceries order was brought in during the 80s to prevent supermarkets selling bread (among other things) as loss leaders to attract business.

I don't know about that the supermarket couponing is new it stated last year I have received in the post 3 vouchers offering 6 euro off each shop of 40 euros in Tesco, I know it an attempt to get market share but it is keeping prices down. The voucher I got for the hotel included the weekends and is keeping hotel prices down.

antoobrien

mariaalice wrote: »

I don't know about that the supermarket couponing is new it stated last year I have received in the post 3 vouchers offering 6 euro off each shop of 40 euros in Tesco, I know it an attempt to get market share but it is keeping prices down. The voucher I got for the hotel included the weekends and is keeping hotel prices down.

They've been doing that or things like that for years through the clubcard (as have dunnes). One of the criticisms of the loyalty cards was that they never offered cash equivalents (like the 6 off €40) just extra points off stuff you may not want.

Voltex

Promotions, discounting, new products are all part of the dynamics of competition.
The lack of credit growth could be a sign of deflation, but when you add in your observations OP it could be complementary evidence to suggest deflation.