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I respectfully disagree. The whole point of inflation is to monetize the crazy debt spirals by empires. Its why the romans did it, why the Germans did it, why

I respectfully disagree. The whole point of inflation is to monetize the crazy debt spirals by empires. Its why the romans did it, why the Germans did it, why the british did it , and its why we do it. It doesn't take an econ degree to know that. That was the reason the gold window was closed in the first place. If the whole point of inflation, mind you, is to encourage investment, then why does the fed react by spiking interest rates in the , 60s' 70's, 82 to address inflation...yet introducing a bona fide investment meltdown ? Thats what reveals the facade. If the purpose of inflation was to encourage investment, it is certainly an odd to react to inflation by increasing interest rates, and destroying business investment in the process. >>>>>>You’re not supposed to save money under the mattress, s you’re supposed to save value by purchasing assets. This sure sounds like you know better than everyone else. Its probably an attitude that would be frowned upon by someone that believes in freedom of choice, like we do in USA. >>>>Wages have on average kept pace with inflation. I don't know if that is true since you have no sources, but the total count of people living in the US under the poverty line is exactly where it was in 1959, and now, post pandemic, it is certainly far higher. So even if wages kept pace, which is uncertain, with technology advances and the dollar as the reserve currency, you would expect the total number of people to be lower. https://en.wikipedia.org/wiki/File:Number_in_Poverty_and_Poverty_Rate,_1959_to_2017.png https://en.wikipedia.org/wiki/File:Number_in_Poverty_and_Pov... >>>>>>>You keep a small slush fund for a rainy day in a savings account that at least partially offsets inflation and you invest the rest. You don’t save money, you save value. You transact money. If you’re saving money you’re doing it wrong. This is valid because there is inflation. But it saddens me to think that you think it is perfectly rational and acceptable to steal money from the savings of hardworking people, who often have to fend off scams left and right...and thus keep the money for themselves, for no real reason other than that it is what... you think.

arcticbull 6y ago
>>> Gold Window The gold window was closed because gold was garbage money. A money supply you can’t adjust cannot respond to shocks and it can’t respond to changes in the economy or society. The crash in 2008 and again now would have been much much much worse without an ability to control supply. Inflation is defined in terms of supply and velocity. Velocity plummeted so supply was raised to offset and lo and behold the fed nailed its 2% inflation target in 2020 in spite of epic global chaos. Gold would have ruined us. >>> wages have kept pace with inflation. Wages are up 10% since 1963 on an inflation adjusted basis (https://www.google.com/amp/s/www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/%3famp=1 https://www.google.com/amp/s/www.pewresearch.org/fact-tank/2...). Google is your friend. Yes wealth inequality is a problem, that’s a fiscal and social issue not a monetary policy issue. Tax the rich. >>>> slush fund Nobody’s stealing anything. The inflation target is public and goaled on. Inflation has a purpose. You don’t like that purpose maybe because you don’t understand it maybe because you do, but it’s not theft. There is every chance we’d all be worse off under a 0% inflation environment because it would drastically reduce the liquidity that underlies the entire global economy. Think about it: if poor people have no money and real salary has kept pace with inflation what wealth is inflation reducing? And if we use a 0-inflation or negative inflation currency, what’s to say wages wouldn’t stay flat or go down. Again if you want to help the poor and narrow the gap, tax the rich, this inflation thing is just the game, and railing against it is tilting at the wrong windmills.
- erichocean 6y ago
  > The gold window was closed because gold was garbage money. The gold windows was closed because the French decided to redeem their dollars for gold, and due to the rampant debasement of dollars, there wasn't enough gold available to do so. Source: history.
  - arcticbull 6y ago
    Sure and so it was garbage money; good money never had this problem yeah?
    - jkhdigital 6y ago
      Mises had a few things to say on the subject of what makes money “good” or “bad”. You might learn something if you read The Theory of Money and Credit.
- LordDragonfang 6y ago
  >Wages are up 10% since 1963 on an inflation adjusted basis And they're down 5% since 1970. Claiming that chart shows growth is a gross misreading of that source. The slope of the trendline since 1963 is practically zero.
  - arcticbull 6y ago
    Yeah I should have referenced it as “kept pace with” as I did in the original post for which the parent requested proof.
  - deleted 6y ago
    [deleted]
lazyasciiart 6y ago
> Its probably an attitude that would be frowned upon by someone that believes in freedom of choice, like we do in USA. Believing in freedom of choice has never stopped anyone from believing that there are bad choices.
imtringued 6y ago
>The whole point of inflation is to monetize the crazy debt spirals by empires. Its why the romans did it, why the Germans did it, why the british did it , and its why we do it. It doesn't take an econ degree to know that. That was the reason the gold window was closed in the first place. Hyperinflation is what happens when the economy collapses and you are deep in debt both at the same time. When people talk about inflation as a policy goal they usually talk about a moderate amount like 2% or maybe 4% if you have an appetite for risk but also greater potential gains. Hyperinflation is never a policy goal, it's what happens when things have gone wrong entirely. >If the whole point of inflation, mind you, is to encourage investment, then why does the fed react by spiking interest rates in the , 60s' 70's, 82 to address inflation...yet introducing a bona fide investment meltdown ? Thats what reveals the facade. If the purpose of inflation was to encourage investment, it is certainly an odd to react to inflation by increasing interest rates, and destroying business investment in the process. Too much inflation is a bad thing. It means there are not enough workers/there is not enough production capacity to meet all needs. Interest rates reduce inflation and thus demand for workers by making sure only the most productive investments stay on the market. A dead company can just borrow money to hire people and waste their time if interest rates are negative. If interest rates are low like 3% then your company has to make a moderate profit. They have to put people to good use. If interest rates are too high it means only the most productive companies can even make it in the market. Some industries like agriculture have low yields (as in dividends) that cannot afford high interest rates but they are extremely important for our society. We must hit a balance between a non productive and too productive economy and interest rates can contribute to this. >This sure sounds like you know better than everyone else. Its probably an attitude that would be frowned upon by someone that believes in freedom of choice, like we do in USA. The reality is that if someone has 20 years of salary in their bank account and another person is unemployed for 20 years the value of your money is gone because that person that owed work for your money didn't work during that time. Food rots, people age. Your money exists purely as a representation of labor and its products and thus even money has to rot. If your money doesn't rot but there are less apples in the future then you can still buy the same number of apples (or more) and thus your share of apples grows even though you have done nothing to deserve them. People save with precious metals, real estate and stocks (technically just the land) because they do not deteriorate. Well, that's not entirely true. If you save in gold you are betting that an economy will exist in the future that can give you apples in exchange for gold. If you save in land you are betting that people will gather around you and live and work around your plot of land. If you save in stocks you are betting that the company will not go bankrupt in the future. How do you make sure that people will work both work today and tomorrow? You just pay them more tomorrow. That's why inflation is a policy goal. >I don't know if that is true since you have no sources, but the total count of people living in the US under the poverty line is exactly where it was in 1959, and now, post pandemic, it is certainly far higher. So even if wages kept pace, which is uncertain, with technology advances and the dollar as the reserve currency, you would expect the total number of people to be lower. Inflation is generally driven by a shortage of labor and a shortage of labor drives salaries. There are some exceptions. You can build an economy that is unable to employ everyone but that's not an argument against inflation. It's an argument against specific policies. The government can just ban work and everyone will agree that this is stupid. There are less nefarious policies that can have the same harmful but lesser effect. Inflation is down because there is a complete lack of domestic demand for a certain segment of the population. College educated people tend to do far better than those with just a high school diploma. There are two reasons for this. Globalization makes unskilled labor unnecessary domestically. That means less work where you can sell your body but the work where you use your brain hasn't moved. That portion is actually growing. The second problem is that employers have absolved themselves of the responsibility to train their workers. That means you are now responsible for your own education. This means people must go to college but it also means there are some unfortunate souls that did not acquire the right skills for the current labor market. >This is valid because there is inflation. But it saddens me to think that you think it is perfectly rational and acceptable to steal money from the savings of hardworking people, who often have to fend off scams left and right...and thus keep the money for themselves, for no real reason other than that it is what... you think. That's not savings. That's rotting paper. It's not even stealing because you can get interest on your savings if inflation is high.

arcticbull 6y ago

>>> Gold Window The gold window was closed because gold was garbage money. A money supply you can’t adjust cannot respond to shocks and it can’t respond to changes in the economy or society. The crash in 2008 and again now would have been much much much worse without an ability to control supply. Inflation is defined in terms of supply and velocity. Velocity plummeted so supply was raised to offset and lo and behold the fed nailed its 2% inflation target in 2020 in spite of epic global chaos. Gold would have ruined us. >>> wages have kept pace with inflation. Wages are up 10% since 1963 on an inflation adjusted basis (https://www.google.com/amp/s/www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/%3famp=1 https://www.google.com/amp/s/www.pewresearch.org/fact-tank/2...). Google is your friend. Yes wealth inequality is a problem, that’s a fiscal and social issue not a monetary policy issue. Tax the rich. >>>> slush fund Nobody’s stealing anything. The inflation target is public and goaled on. Inflation has a purpose. You don’t like that purpose maybe because you don’t understand it maybe because you do, but it’s not theft. There is every chance we’d all be worse off under a 0% inflation environment because it would drastically reduce the liquidity that underlies the entire global economy. Think about it: if poor people have no money and real salary has kept pace with inflation what wealth is inflation reducing? And if we use a 0-inflation or negative inflation currency, what’s to say wages wouldn’t stay flat or go down. Again if you want to help the poor and narrow the gap, tax the rich, this inflation thing is just the game, and railing against it is tilting at the wrong windmills.

erichocean 6y ago
> The gold window was closed because gold was garbage money. The gold windows was closed because the French decided to redeem their dollars for gold, and due to the rampant debasement of dollars, there wasn't enough gold available to do so. Source: history.
- arcticbull 6y ago
  Sure and so it was garbage money; good money never had this problem yeah?
  - jkhdigital 6y ago
    Mises had a few things to say on the subject of what makes money “good” or “bad”. You might learn something if you read The Theory of Money and Credit.
LordDragonfang 6y ago
>Wages are up 10% since 1963 on an inflation adjusted basis And they're down 5% since 1970. Claiming that chart shows growth is a gross misreading of that source. The slope of the trendline since 1963 is practically zero.
- arcticbull 6y ago
  Yeah I should have referenced it as “kept pace with” as I did in the original post for which the parent requested proof.
- deleted 6y ago
  [deleted]

lazyasciiart 6y ago

> Its probably an attitude that would be frowned upon by someone that believes in freedom of choice, like we do in USA. Believing in freedom of choice has never stopped anyone from believing that there are bad choices.

imtringued 6y ago

>The whole point of inflation is to monetize the crazy debt spirals by empires. Its why the romans did it, why the Germans did it, why the british did it , and its why we do it. It doesn't take an econ degree to know that. That was the reason the gold window was closed in the first place. Hyperinflation is what happens when the economy collapses and you are deep in debt both at the same time. When people talk about inflation as a policy goal they usually talk about a moderate amount like 2% or maybe 4% if you have an appetite for risk but also greater potential gains. Hyperinflation is never a policy goal, it's what happens when things have gone wrong entirely. >If the whole point of inflation, mind you, is to encourage investment, then why does the fed react by spiking interest rates in the , 60s' 70's, 82 to address inflation...yet introducing a bona fide investment meltdown ? Thats what reveals the facade. If the purpose of inflation was to encourage investment, it is certainly an odd to react to inflation by increasing interest rates, and destroying business investment in the process. Too much inflation is a bad thing. It means there are not enough workers/there is not enough production capacity to meet all needs. Interest rates reduce inflation and thus demand for workers by making sure only the most productive investments stay on the market. A dead company can just borrow money to hire people and waste their time if interest rates are negative. If interest rates are low like 3% then your company has to make a moderate profit. They have to put people to good use. If interest rates are too high it means only the most productive companies can even make it in the market. Some industries like agriculture have low yields (as in dividends) that cannot afford high interest rates but they are extremely important for our society. We must hit a balance between a non productive and too productive economy and interest rates can contribute to this. >This sure sounds like you know better than everyone else. Its probably an attitude that would be frowned upon by someone that believes in freedom of choice, like we do in USA. The reality is that if someone has 20 years of salary in their bank account and another person is unemployed for 20 years the value of your money is gone because that person that owed work for your money didn't work during that time. Food rots, people age. Your money exists purely as a representation of labor and its products and thus even money has to rot. If your money doesn't rot but there are less apples in the future then you can still buy the same number of apples (or more) and thus your share of apples grows even though you have done nothing to deserve them. People save with precious metals, real estate and stocks (technically just the land) because they do not deteriorate. Well, that's not entirely true. If you save in gold you are betting that an economy will exist in the future that can give you apples in exchange for gold. If you save in land you are betting that people will gather around you and live and work around your plot of land. If you save in stocks you are betting that the company will not go bankrupt in the future. How do you make sure that people will work both work today and tomorrow? You just pay them more tomorrow. That's why inflation is a policy goal. >I don't know if that is true since you have no sources, but the total count of people living in the US under the poverty line is exactly where it was in 1959, and now, post pandemic, it is certainly far higher. So even if wages kept pace, which is uncertain, with technology advances and the dollar as the reserve currency, you would expect the total number of people to be lower. Inflation is generally driven by a shortage of labor and a shortage of labor drives salaries. There are some exceptions. You can build an economy that is unable to employ everyone but that's not an argument against inflation. It's an argument against specific policies. The government can just ban work and everyone will agree that this is stupid. There are less nefarious policies that can have the same harmful but lesser effect. Inflation is down because there is a complete lack of domestic demand for a certain segment of the population. College educated people tend to do far better than those with just a high school diploma. There are two reasons for this. Globalization makes unskilled labor unnecessary domestically. That means less work where you can sell your body but the work where you use your brain hasn't moved. That portion is actually growing. The second problem is that employers have absolved themselves of the responsibility to train their workers. That means you are now responsible for your own education. This means people must go to college but it also means there are some unfortunate souls that did not acquire the right skills for the current labor market. >This is valid because there is inflation. But it saddens me to think that you think it is perfectly rational and acceptable to steal money from the savings of hardworking people, who often have to fend off scams left and right...and thus keep the money for themselves, for no real reason other than that it is what... you think. That's not savings. That's rotting paper. It's not even stealing because you can get interest on your savings if inflation is high.