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Zerodha's Nikhil Kamath has a question on inflation: In what order do people control spending?

Nikhil Kamath asked on Twitter. "What happens when inflation eventually and inevitably leads to higher unaffordable prices...

May 12, 2022 / 09:44 AM IST
Nikhil Kamath, Co-founder, True Beacon and Zerodha

Nikhil Kamath, Co-founder, True Beacon and Zerodha


Zerodha co-founder Nikhil Kamath on Wednesday posted a question on Twitter regarding the steep inflation the country has slipped into.

"What happens when inflation eventually and inevitably leads to higher unaffordable prices," Kamath tweeted. "People stop buying homes, autos, stocks, jewelry, watches, electronics, holidays, new clothes, etc."

Then he asked his followers in what order do they control their spending. "Holidays-auto-electronics first?" he asked.

"I believe it starts with going out for movies and dinner and other entertainment options like OTT. Holidays second. Auto and electronics (mobile specially) become necessity for some families," Twitter user Utsav Verma wrote in response.

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"Watches, automobiles. In terms of electronics, people will defer their purchase or continue using their current device a little longer. Similarly, they made travel to a destination in India or South Asia instead of Europe,"  commented another user Yorick Pinto.

Some of the followers pointed out how the pandemic taught them to spend less on non-essential items.

"Disposable income is reducing at an exponential rate for most people, and after seeing financial distress during the pandemic, people have started to reduce buying non-essential products," tweeted Altaf Petiwala. "People have realised the value of having a safety net of a few months expenses as savings."



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first published: May 11, 2022 12:58 pm
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