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No, dantheman has it right. Inflation hurts poorer people proportionately more. Richer people tend to have assets like property which inflate in value right alo
by jeromec 17y ago
No, dantheman has it right. Inflation hurts poorer people proportionately more. Richer people tend to have assets like property which inflate in value right along with the currency. If you inflate by 15% from one week to the next a rich person's standard of living hasn't decreased much, but a poor person's certainly has.
- yummyfajitas 17y agoInflation has two effects; across the board pay cuts and it reduces the value of dollar denominated assets. Pay cuts hit everyone with an income equally. The poor/middle class tend to have a larger fraction of their wealth in property. The typical middle class family owns either a home or a call option/mortgage on a home which comprises the bulk of their wealth. The rich also own property, but it's not as large a fraction of their wealth as it is for the poor. The typical rich person owns both a home and an investment portfolio, the latter of which will suffer with inflation.