Dear Log,
«One of the basic tenets of classical economics is Say's law, which states that there can never be slumps because supply creates its own demand. But, as Robert Kuttner says in his book (Everything for Sale), the reality of globalisation is that low-wage workers in poor countries are adding vastly to the world's supply of goods but lack the purchasing power to buy the products they make. There is, in other words, a global deficiency in aggregate demand that is leading inexorably to lower prices, thus intensifying deflationary forces.»
