Capital flowed everywhere across the economy, funding start-ups, stimulating stock markets and changing consumers’ spending habits. Then, the money started slowing, and things began to change. Prices went up as wage increases stayed below inflation, putting a squeeze on consumer discretionary spending. Sales figures declined in some industries while supply and employment costs increased, squeezing many corporations’ ability to sustain their current earnings records. Governments are just starting to feel the pullback, as tax revenues have been below expectations, while expenditures have steadily increased, causing a squeeze on several local, state and federal governments.
Raising salaries, prices and taxes is becoming more difficult, even as they become more necessary. Together, these squeezes mean that individuals, to stay afloat, and institutions, to remain viable, have entered a period of reallocating resources, cutting some areas of their budget to fund others, as society and the economy move through a structured readjustment to realities that highlight limits rather than abundance.