> If you want to redistribute the wealth from the holders of capital, pass laws to do so directly. Doing it in in a roundabout way via inflation is a psychologi

> If you want to redistribute the wealth from the holders of capital, pass laws to do so directly. Doing it in in a roundabout way via inflation is a psychological trick - you are saying, "Well, laws can't be passed to do it, so we will use this crazy constant-devaluation of everyone's money to accomplish it" and the new money doesn't go to the people you want to help directly. Furthermore, poor people with tiny amounts of savings can't even begin to save as their money is constantly debased. I don't see this as an argument against deflation. I wouldn't call it a "psychological trick". Nobody is tricking anyone, if steady and moderate inflation is the goal of a competent central bank. > Furthermore, poor people with tiny amounts of savings can't even begin to save as their money is constantly debased. I don't see this as an argument against deflation. But they can take on ever-debased debt! > It is matters of degree to me. The US has defaulted twice in the last 100 years, first with the confiscation of gold in the 30s and later with the outright withdrawal from the gold standard in the 70s. You can argue whatever you want, but that is a de-facto default when the rules that were promised are suddenly changed at gunpoint, and now past promises are now longer valid. I see the US and other "well-functioning liberal democracies" as easily able to slip into being monetary basket cases, as they have been several times over history. The 1970s/80s had absurd levels of inflation in the US which shows the situation can change rapidly. I think there is a high-risk of 10%+ inflation in the US right now. I'm not entirely sure I'd call the US a well-functioning liberal democracy, but I'd definitely not call withdrawing from the gold standard defaulting. Besides, isn't inflation-targeting at central banks a relatively new invention? And let's be entirely clear: if most experts saw a high risk for imminent 10%+ inflation, they would be given a very very loud microphone. Your view is a fringe one. > The finance sector in all western democracies is a large component of GDP - far higher than what it would be in a hard-money system IMO. Those closer to the money printer somehow get a larger share of it. Always happens. Along the lines of what you wrote above: let's pass laws to change that then. > I don't see why we need to artificially encourage people to spend. People should spend if they want something, not because of seizing their money if they choose not to spend. As I said before, people will always need goods and services. "Hoarding" money is just someone choosing to delay their gratification, which I see as a good thing. That's your personal view. Easy access to money is an important mechanism for people with actual good ideas to realize them. In a society where hoarding is "artificially encouraged" instead (see, both of us can play the game of inserting loaded adverbs or adjectives ;)), this mechanism stops functioning properly. > My point is not to say why they deflated. My point is that there was deflation, and it didn't cause any problems. Economists act like the sky will fall if deflation occurs. It happened in computers and it was awesome. Computers are not currency. I want different properties for goods and for currency. I don't think that's a very original desire. > Yes? Why should citizens-of-the-future pay for what citizens-of-the-now want? Actually paying for things would cause an honest discussion of what people are willing to pay for. If you tell people they can have everything they want for free, of course they want it. This is the weakest argument of all. Are you doubting the usefulness of debt at all? > You act is if the rich don't accumulate capital now. I find this argument invalid. In reality it's the poor that can't easily escape inflation and lose their money, while the rich are able to continue to accumulate wealth above the rate of inflation using their vast array of wealth advisors and tax lawyers. The poor are the ones without an easy way to protect their wealth in an inflationary world. They do, of course. But you're suggesting we use "psychological tricks" to incentivize this behavior! I certainly share your opinion that something needs to be done about the super-wealthy. I think the only viable solution is broad capital taxation agreements between the well-functioning liberal democracies of the world.