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> Since 1971, unfettered monetary inflation has been used to siphon wealth from the people for the benefit of a segment of rich elites close with the federal re

> Since 1971, unfettered monetary inflation has been used to siphon wealth from the people for the benefit of a segment of rich elites close with the federal reserve. The median household debt is $90,460 in the US, and the median savings is significantly lower than that. So barring hyperinflation, some reasonable inflation is actually beneficial for 'the people.' It's diluting their debt. Meanwhile, the most common investment for working people is in their home, and real estate is one of the best inflation shelters. The parties most harmed by inflation are the ones sitting on huge amounts of cash without using it productively (so, not 'the people'), and those are exactly the parties who need a fire lit under them to prevent a deflation spiral.

hpoe 5y ago
Here's the problem I own a home I am not owning that home as an investment vehicle I didn't choose the home to make a return I got that home as a place to fricking live, I chose my home because it would be most comfortable for my wife and family. The "value of the home" is an imaginary number in a database somewhere that doesn't actually do me any good when I need to pay for a hospital visit, or need to buy a car or something like that. In fact the more of my "value" is locked up in my home the less I am able to access it. Besides even if I were to liquidate what should I do then, go live under a bridge, the problem is even if my home has increased in value so has everyone else's home so even if I liquidate I'll still be stuck having to roll all that value over into a new home anyway because no matter what happens I still need a place to live.
- mullingitover 5y ago
  > In fact the more of my "value" is locked up in my home the less I am able to access it. It's extremely easy to access the value of your home, home equity lines of credit are used all the time.
  - billytetrud 5y ago
    When the only way to access the value of your property is to pay a rent (interest) to someone else, then that isn't really easy access, now is it?
    - mullingitover 5y ago
      It's the easiest way in comparison to losing physical access to the property by selling or renting it out. Equity lines of credit are very easy, they're not free money but then again TANSTAAFL.
- xxpor 5y ago
  >or need to buy a car or something like that. People buy cars with HELOCs all the time.
  - hpoe 5y ago
    People also buy flat screens with payday loans, just because everyone is doing it doesn't mean that is sound financial advice.
    - xxpor 5y ago
      That's not the point though. The argument that you can't access you home's equity without selling is complete nonsense.
- imtringued 5y ago
  Yes, increasing land prices are stupid. The idea that people are investing into land is absurd. This is actually an example of deflation hurting the poor. It's not deflation of the USD. It's deflation of land as people start hoarding land and reduce the available supply. If we could "print" more land this wouldn't be a problem. It's like those game item NFTs. ETH goes up by 4x. Items get more expensive by 4x. It's just stupid.
psychlops 5y ago
I'd suggest those most harmed are those with little to no savings (>75% of US population according to Statista) and simply pay higher prices year over year.
- kbenson 5y ago
  Don't wages generally go up with inflation too? If you have no money saved to devalue, how are you harmed? If you have debt, you are helped. It seems like the cases where you would have harm is if you have savings and/or you do not get a raise to help with inflation, and little or no debt in both cases.
  - billytetrud 5y ago
    They should. But the reality is that they haven't: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us... There is more to monetary inflation than simply money devaluation: https://news.ycombinator.com/item?id=27476789 https://news.ycombinator.com/item?id=27476789
    - mullingitover 5y ago
      The article you linked seems to be saying the opposite: > In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago. Having the same purchasing power means that wages have indeed kept up with inflation. If they didn't, it wouldn't be the same purchasing power, it would be diminished purchasing power.
      - reedjosh 5y ago
        Excepting that the `pie` that is the global economy of goods and services has grown significantly. So in this case, we're all producing more than ever, but not gaining any more than we used to.
reedjosh 5y ago
This misses that if there's a net benefit to asset backed debt, then the wealthy will gain from that the most. As in my example above, gaining 1% net benefit on a $250k house can never compare to billionaires gaining 1% on their levels of asset backed debt. Then there's fractional reserve banking which benefit banks via interest on money that otherwise didn't exist. And as of just over a year ago, there's no fraction of the fractional reserve left. The fed lowered the reserve requirement to 0% https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...
- notahacker 5y ago
  Under a gold standard, you'd be lucky to get the 1% gain in value on the $250k house, and due to the relative scarcity of money the billionaires would be making a lot more on each dollar they lent you.

hpoe 5y ago

Here's the problem I own a home I am not owning that home as an investment vehicle I didn't choose the home to make a return I got that home as a place to fricking live, I chose my home because it would be most comfortable for my wife and family. The "value of the home" is an imaginary number in a database somewhere that doesn't actually do me any good when I need to pay for a hospital visit, or need to buy a car or something like that. In fact the more of my "value" is locked up in my home the less I am able to access it. Besides even if I were to liquidate what should I do then, go live under a bridge, the problem is even if my home has increased in value so has everyone else's home so even if I liquidate I'll still be stuck having to roll all that value over into a new home anyway because no matter what happens I still need a place to live.

mullingitover 5y ago
> In fact the more of my "value" is locked up in my home the less I am able to access it. It's extremely easy to access the value of your home, home equity lines of credit are used all the time.
- billytetrud 5y ago
  When the only way to access the value of your property is to pay a rent (interest) to someone else, then that isn't really easy access, now is it?
  - mullingitover 5y ago
    It's the easiest way in comparison to losing physical access to the property by selling or renting it out. Equity lines of credit are very easy, they're not free money but then again TANSTAAFL.
xxpor 5y ago
>or need to buy a car or something like that. People buy cars with HELOCs all the time.
- hpoe 5y ago
  People also buy flat screens with payday loans, just because everyone is doing it doesn't mean that is sound financial advice.
  - xxpor 5y ago
    That's not the point though. The argument that you can't access you home's equity without selling is complete nonsense.
imtringued 5y ago
Yes, increasing land prices are stupid. The idea that people are investing into land is absurd. This is actually an example of deflation hurting the poor. It's not deflation of the USD. It's deflation of land as people start hoarding land and reduce the available supply. If we could "print" more land this wouldn't be a problem. It's like those game item NFTs. ETH goes up by 4x. Items get more expensive by 4x. It's just stupid.

psychlops 5y ago

I'd suggest those most harmed are those with little to no savings (>75% of US population according to Statista) and simply pay higher prices year over year.

kbenson 5y ago
Don't wages generally go up with inflation too? If you have no money saved to devalue, how are you harmed? If you have debt, you are helped. It seems like the cases where you would have harm is if you have savings and/or you do not get a raise to help with inflation, and little or no debt in both cases.
- billytetrud 5y ago
  They should. But the reality is that they haven't: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us... There is more to monetary inflation than simply money devaluation: https://news.ycombinator.com/item?id=27476789 https://news.ycombinator.com/item?id=27476789
  - mullingitover 5y ago
    The article you linked seems to be saying the opposite: > In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago. Having the same purchasing power means that wages have indeed kept up with inflation. If they didn't, it wouldn't be the same purchasing power, it would be diminished purchasing power.
    - reedjosh 5y ago
      Excepting that the `pie` that is the global economy of goods and services has grown significantly. So in this case, we're all producing more than ever, but not gaining any more than we used to.

reedjosh 5y ago

This misses that if there's a net benefit to asset backed debt, then the wealthy will gain from that the most. As in my example above, gaining 1% net benefit on a $250k house can never compare to billionaires gaining 1% on their levels of asset backed debt. Then there's fractional reserve banking which benefit banks via interest on money that otherwise didn't exist. And as of just over a year ago, there's no fraction of the fractional reserve left. The fed lowered the reserve requirement to 0% https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...

notahacker 5y ago
Under a gold standard, you'd be lucky to get the 1% gain in value on the $250k house, and due to the relative scarcity of money the billionaires would be making a lot more on each dollar they lent you.