>Inflation screws the rich, not the poor. This is a pretty bold statement given that it is the opposite of all conventional wisdom, and historically those conc

>Inflation screws the rich, not the poor. This is a pretty bold statement given that it is the opposite of all conventional wisdom, and historically those concerned with the poor have argued that inflation is a way for the rich to rob the poor. For example, the "misery index" in the 70s was the sum of inflation and unemployment, because it tracked how much wages were falling and how much unemployment there was. So this "new economics" that says inflation is good for the poor is pretty stunning -- is it something you figured out on your own or do you have a reference for statisticians or economists making this case? > Statistically, the wealthy have way more cash than the poor, while the wage-earning population will get increased income along with inflation. Let's take a look at what is going on: Over the past year inflation is up 6.2%, so let's deflate: - real SP500: +25% - real bonds: -7.8% (PIMCO total return)[2] - real wages: -1.2% (using BLS data)[1] "Real average hourly earnings decreased 1.2 percent, seasonally adjusted, from October 2020 to October 2021."[1] Now definitions of "rich" are always arbitrary, but if you are rich you have most of your wealth in the form of assets -- stocks, bonds, etc. If you are poor, most of your wealth is your future labor - wages. That's another way of saying that the rich make money from passive income while the poor have to work. So inflation reduces wages but the effect on passive income is mixed. Stocks go up and bonds go down. A typical wealthy person will own a mix of stocks and bonds and will generally own more stocks than bonds, so on balance their holding of equity protects them and their wealth still increases. But that's not true for the poor, who have only their wages. This is why conventional wisdom about inflation mostly hurting the poor is correct, and the galaxy-brain takes that inflation helps the poor and hurts the rich is incorrect. Wealthy people can shield themselves from the rising cost of consumption while the poor cannot. [1] https://www.bls.gov/news.release/realer.htm https://www.bls.gov/news.release/realer.htm [2] https://www.pimco.com/en-us/investments/mutual-funds/total-return-fund/inst https://www.pimco.com/en-us/investments/mutual-funds/total-r...