Every household on the floor watches the recent price trend, not just today's price. When that trend turns negative, a share of them rationally decide to wait — "it'll be cheaper next week" — so current demand drops. Facing weaker sales, businesses cut prices further to attract the shrinking pool of willing buyers. That fresh cut confirms the belief that started the whole thing, so even more households delay — a self-reinforcing loop.
Trigger price shock knocks the price level down and seeds a falling-price expectation. Watch the delay rate climb and demand sag in lockstep with the price chart. Stimulus injects demand and price support that decay over a few seconds — strong enough, and it closes the demand gap before it decays, breaking the loop for good; too weak, and the spiral resumes once it fades out.
- Price level — the general price index; falling means deflation.
- Price trend (expected) — the belief households form from the recent trend; this, not the price itself, drives delay behaviour.
- Purchase-delay rate — the fraction of households postponing spending this round.
- Aggregate demand — current spending relative to the economy's baseline.