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I dont think inflation hurts the poor. It hurts the middle class with 5-15k in savings. The poor are living oaycheck to paycheck and they will continue to do s
by throwaway98797 5y ago
I dont think inflation hurts the poor. It hurts the middle class with 5-15k in savings.
The poor are living oaycheck to paycheck and they will continue to do so. Yet the people on the first wrung of wealth building see their progress destroyed.
- seoaeu 5y agoYeah. In fact, the poorest have a negative net worth due to owing more on debts than they hold in assets so inflation makes them wealthier
- yadaeno 5y agoThis would only be the case if wages rose with inflation which they don't.
- throwaway98797 5y agothey do at the bottom. people cant live below a certain threshold. business need employees. it is a combo of gov funds and employment that keeps them alive. see % of walmart employees on food assistance.
- javagram 5y agoThe article notes “ Inflation-adjusted compensation is down in most industries, but there is one notable exception: Leisure and hospitality. That industry's employers are scrambling to find workers, resulting in a 1.6% bump in pay and benefits since December 2019, according to Furman's analysis.” So it really depends on your industry, there are plenty of poor working class who have hospitality jobs.
- dragonwriter 5y ago> It hurts the middle class with 5-15k in savings. If you have 5-15K in dollar-denominated-fixed-interest savings you either: (1) Are in the middle class and have at least a couple orders of magnitude more than that in productive investments that aren't dollar-denominated fixed-interest assets. Or, (2) are in the working, not middle, class, and probably despite having that in gross savings, have net dollar-denominated debt.
- deadbolt 5y agoOr are a young adult who is saving for a house.
- dragonwriter 5y agoIf you have long-term savings and they are predominantly in dollar-denominated fixed-interest accounts, you are doing investing for the future wrong.
- deadbolt 5y agoWell, I also have a 401k and an Roth IRA, but I have a large amount of money in dollar-denominated fixed-interest accounts because it's money I'm planning on using within the next few years. Is there something else I should be doing? I don't consider <5 years to be long-term savings. Am I incorrect?
- ac29 5y agoIf you're saving to buy a house in 10 years, putting the money in a savings account (or similar) is almost certainly a bad idea. If you're saving to buy a house in 6 months, almost anything else would be a bad idea.
- danaris 5y agoYou think that the "middle class" has 500k-1.5M in "productive investments" per household?? I think you need to double-check your definition of "middle class".
- csomar 5y agoInflation does not cause wages to go up (at least it’s not always the case). I lived in a place with high inflation and wages did go down at that time because the economy was bad. (Stagflation) Not only it hurts the poor more; it basically roasts them as they can’t pay for necessities.
- dragonwriter 5y ago> Inflation does not cause wages to go up (at least it’s not always the case). There are many forces affecting wages, but inflation puts upward pressure on wages and wages put upward pressure on consumer prices, so they tend, and not just by coincidence, to move the same direction. > I lived in a place with high inflation and wages did go down at that time because the economy was bad. (Stagflation) “Stagflation” has a name as a combination of economic conditions because it is unusual.