Understanding the One Way in Which an Economic Boom Can be Disadvantageous to the Poor

Often, we are made to believe that an economic boom is a good thing for all. After all, when there is an economic boom, the economy creates more jobs, people’s spending power goes up… and all the other good things. The truth, however, is that an economic boom (just like any other thing) has its advantages and its disadvantages. If we take poor people, for example, we come to discover that there is at least one way in which an economic boom can be disadvantageous to them.

In order to understand the way in which an economic boom can be disadvantageous to the poor, you have to appreciate that when there is an economic boom, the result is usually more money circulating in the economy. And when there is more money circulating in the economy, inflation tends to go up: as more money competes for the same limited products that are available in the market. And this is where the economic boom can be disadvantageous to the poor: given that the resultant inflation ends up eroding the purchasing power of the little money they happen to have. In this context, when we make reference to the poor, we are talking of the truly poor folks: not the sorts of folks who can afford getting remote IT support through sites like logmein123.com: that is, folks who go to the Logmein login page with an objective of receiving IT support remotely. Neither does that include affluent folks who have the sorts of businesses whose operations are so vast that they have to rely on Oracle databases. Rather, we are talking about truly poor people: the sorts of folks who live on a paycheck to paycheck basis.