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I actually went to school (which included economics in its curriculum). I have also worked for many financial institutions over past 20 years including banks,

I actually went to school (which included economics in its curriculum). I have also worked for many financial institutions over past 20 years including banks, brokerage houses and insurance companies. Currently for Citi Group as a tech lead for one of its risk systems. My work requires me to understand what inflation is because it has very deep impact on everything we do. Here you have other reputable source: https://www.investopedia.com/terms/i/inflation.asp https://www.investopedia.com/terms/i/inflation.asp "Inflation is the decline of purchasing power of a given currency over time."

neilwilson 5y ago
"I actually went to school (which included economics in its curriculum). That'll be your problem. Any training in economics or financial institutions leads to a skewed view of how the world actually works. You don't understand what inflation is. You understand what financial institutions want to consider inflation to be because it affects the returns on the debt instruments. For everybody else in the economy that isn't a problem. In fact it is of benefit to them since it redistributes away from financial institutions towards actual people doing stuff. Inflation is more than just a narrow view of price changes. "When a further increase in the quantity of effective demand produces no further increase in output and entirely spends itself on an increase in the cost-unit fully proportionate to the increase in effective demand, we have reached a condition which might be appropriately designated as one of true inflation. Up to this point the effect of monetary expansion is entirely a question of degree, and there is no previous point at which we can draw a definite line and declare that conditions of inflation have set in. Every previous increase in the quantity of money is likely, in so far as it increases effective demand, to spend itself partly in increasing the cost-unit and partly in increasing output." The General Theory of Employment, Interest, and Money; John Maynard Keynes' Ch 21, V

neilwilson 5y ago

"I actually went to school (which included economics in its curriculum). That'll be your problem. Any training in economics or financial institutions leads to a skewed view of how the world actually works. You don't understand what inflation is. You understand what financial institutions want to consider inflation to be because it affects the returns on the debt instruments. For everybody else in the economy that isn't a problem. In fact it is of benefit to them since it redistributes away from financial institutions towards actual people doing stuff. Inflation is more than just a narrow view of price changes. "When a further increase in the quantity of effective demand produces no further increase in output and entirely spends itself on an increase in the cost-unit fully proportionate to the increase in effective demand, we have reached a condition which might be appropriately designated as one of true inflation. Up to this point the effect of monetary expansion is entirely a question of degree, and there is no previous point at which we can draw a definite line and declare that conditions of inflation have set in. Every previous increase in the quantity of money is likely, in so far as it increases effective demand, to spend itself partly in increasing the cost-unit and partly in increasing output." The General Theory of Employment, Interest, and Money; John Maynard Keynes' Ch 21, V