Editing Idea:The Asset Inflation Paradox During Technological Deflation (section)

== The Mechanism ==

=== Two-Sector Economy Structure ===

'''Real Economy''': 
* AI drives costs toward zero
* Competition eliminates margins
* Output becomes abundant and cheap
* Workers displaced by automation

'''Financial Economy''':
* Assets become claims on automated production
* Monetary policy fights deflation with liquidity
* Scarcity premium on ownership increases
* Capital concentration accelerates

=== The Flow Dynamics ===

# '''Central Bank Response''': Technology-driven deflation triggers monetary expansion
# '''Liquidity Seeking Returns''': New money flows into yield-generating assets
# '''Scarcity Creation''': Limited number of productive assets vs. expanding money supply
# '''Bidding Wars''': Asset prices rise as real yields fall
# '''Wealth Concentration''': Asset owners capture benefits of productivity gains