3 ms·

Unfortunately higher inflation comes with higher interest rates. So if you have "negative wealth" you are no better off.

• henvic 6y ago
  Not necessarily. You've to analyze where your wealth goes to and where does the money goes to. Even if you're one of the ones who benefit from 'getting the money first' (like, if you mortgaged a house with low interest rates) there might be nefarious consequences. For example, right now I'm looking into buying a house through a mortgage that with less than 2% yearly interest. I'm going to pay the house in about 30 years if I never change the conditions of the agreement, and I can have 10 years guaranteed low interest rates. So you might believe I should be completely happy with inflation... Except what you don't see is the effect the inflation has in the overall economy, and also more immediately on my pocket. The house is going to be about 5 years of my current gross yearly salary. If there wasn't this artificial easy credit through inflation, I could probably pay a lot less for the house and maybe even decide to continue renting instead because perhaps renting would be cheaper if people weren't holding properties to speculate and I had more money in general. Anyway, it's still a 25 years difference where I'm going to be losing a lot of money to inflation. I highly recommend this: http://bastiat.org/en/twisatwins.html http://bastiat.org/en/twisatwins.html