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> Net spending power == spending on real goods + spending on debt. I still don't know what this means. What is "spending on debt"? Interest payments? Why are y

> Net spending power == spending on real goods + spending on debt. I still don't know what this means. What is "spending on debt"? Interest payments? Why are you calling amount spent "spending power"? Spending power evokes the idea of potential, not actual spending. Your terminology is confusing. > the interest rate may be increased, however that's not always the case. When the price inflation rate is relatively stable, it will automatically be accounted for via the normal price system (ie not by conscious up pricing). > Regardless, creditors even if they have already priced in inflation will lobby for low-inflation policies as this increases the return on their assets (that is, debt). Ok. Well this isn't true when the creditors are primarily banks reciving seigniorge benefits. > The my claim is trivially verified Your claim that I'm using seigniorage wrong? The definitions you're quoting about seigniorage agree with the way I'm using the word. I don't know why you think I'm using it wrong.

dredmorbius 5y ago
Then drop power. Net spending == consumption + debt payments Reduce debt through inflation, consumption increases a share of total spending. Wealth of creditors increases. We seem to be inhabiting different universes on the remainder of the discussion.
- billytetrud 5y ago
  > Net spending == consumption + debt payments Why is this a useful definition of net spending? What about business spending? What about government spending? Do you include business debt payments in "debt payments"? I also don't know why you think increasing consumption as a total share of spending would increase the wealth of creditors. I get that you're trying to show how inflation leads to debt reduction. It is true that unexpected and sudden increases in inflation lead to debt reduction, but its only one very small piece of the puzzle. Unexpected and sudden inflation is quite rare in our current economic environment.

dredmorbius 5y ago

Then drop power. Net spending == consumption + debt payments Reduce debt through inflation, consumption increases a share of total spending. Wealth of creditors increases. We seem to be inhabiting different universes on the remainder of the discussion.

billytetrud 5y ago
> Net spending == consumption + debt payments Why is this a useful definition of net spending? What about business spending? What about government spending? Do you include business debt payments in "debt payments"? I also don't know why you think increasing consumption as a total share of spending would increase the wealth of creditors. I get that you're trying to show how inflation leads to debt reduction. It is true that unexpected and sudden increases in inflation lead to debt reduction, but its only one very small piece of the puzzle. Unexpected and sudden inflation is quite rare in our current economic environment.