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It won't halve the value of the dollars that are stored, because they are not being spent. Only spent dollars cause price changes, and then only if the capacit
by neilwilson 5y ago
It won't halve the value of the dollars that are stored, because they are not being spent.
Only spent dollars cause price changes, and then only if the capacity to expand is exhausted.
If I have a billion dollars in a cupboard prices won't change at all. More importantly if I have a billion dollars in a bank account prices won't change at all, because money in a bank account isn't available for anybody else to use.
Economists struggle with the difference between a stock and a flow, which is why their accounting is terrible. Particularly their bank accounting.