There’s one thing I’ve noticed that most people still aren’t fully prepared for: the arrival of deflation. This is different from the inflation we’re all familiar with. This year, 2026, seems to be a time when the economy is changing. And if you don’t understand what deflation is, you may miss a crucial opportunity to protect and grow your wealth.

So what exactly is deflation? It’s not just that things get cheaper—it’s a situation where the overall price level in the economy keeps falling. The Consumer Price Index is negative compared with the previous year. What people often confuse is the difference between disinflation and deflation. In disinflation, prices are still rising, but at a slower pace—for example, inflation falling from 5% to 2%. But real deflation means negative inflation, and the prices of goods actually decrease.

I’ve studied history and found that the best case study is the Great Depression from 1929 to 1939. During that period, prices in the United States fell cumulatively by 27%. The event began with the collapse of the stock market, followed by the failure of the banking system. The money supply shrank by more than 30%. As a result, unemployment surged to 25%. Another case is Japan. After the bubble burst in 1990, the country entered more than 30 years of stagnation. Land and stock prices collapsed. Japanese companies chose to repay debt instead of investing. Because people became accustomed to prices falling, they delayed spending.

Now Thailand is facing clear warning signs. Economic growth is projected at only 1.5–1.6% per year. Our society is rapidly aging: older people consume less, and household debt exceeds 85% of GDP. All of this points in the same direction—deflation is becoming a real problem for our country.

When deflation happens, it creates a vicious cycle that’s hard to break. People believe prices will fall further, so they delay buying. Sales decline. Businesses have to cut prices and reduce hiring. People become unemployed. They have no money to buy, sales fall further, and the loop continues. For those with debt, the situation becomes much worse, because the real value of their debt increases. If you have 1 million baht in debt and your income drops by 3%, that debt becomes an even heavier burden.

The stock market will be hit hard. Company profits will fall, and stock prices will adjust downward—especially cyclical stocks. Real estate will also lose value.

So what should you invest in during deflation? Government bonds—especially long-term ones—can be a strong fortress. When the central bank cuts interest rates, bond prices rise. Real returns become much higher because the prices of goods are falling. Holding cash or money market funds is also a good way to preserve the value of your principal, and to keep “powder dry” to buy undervalued assets when the crisis ends.

If you’re going to invest in stocks, choose defensive stocks, such as essential goods or utilities. People still have to eat, still use electricity, and still need medical services—no matter what the economy is like. Gold is a good safe asset. When people don’t trust the banking system, they tend to rush to hold gold.

For those who are more daring, modern financial tools such as CFD can help you profit from the crisis. Short selling is a strategy that lets you profit when prices fall. If you think the market will drop, you can open a sell position right away. When prices fall as expected, you can realize a profit.

Overall, 2026 is a test for those who are prepared. Understanding what deflation is is no longer something far removed. It will shape your financial future—rebalance your portfolio, hold bonds, accumulate gold, or use clever investment strategies. All of these are ways to help you not only survive, but also increase your wealth while others are panicking.