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That's a very simplistic (and ideological) view. World's leading country in inflation, Venezuela, has terrible wages. Inflation makes people overworked, by fo

That's a very simplistic (and ideological) view. World's leading country in inflation, Venezuela, has terrible wages. Inflation makes people overworked, by forcing them so sell under fair price. Wages are sticky, prices are not. That salaries are picking up doesn't mean real salaries have improved. They have not.

eru 5y ago
Be careful. There's a big difference in impact of modest inflation like in the US at the moment vs hyperinflation. The Fed handled the monetary side of the pandemic reasonably well. Inflation overshot a bit, yes. But it's far cry compared to when they caused a slowdown in the housing market to become the Great Recession in 2008-ish.
- thisisnotatest1 5y ago
  Yes, it's exactly the same but different speeds. People with savings and salaries got a nice 7% wealth tax this year The government, with it's massive 20 trillion dollar debt, got a nice 7% write down on the debt, so they can quickly spend this voucher again in a matter of weeks.
  - xref 5y ago
    As someone with student loans and a mortgage, I got a 7% write down but a 18% pay bump this year! Hope I get it for several more years to come
pjc50 5y ago
No, it's just the Philips curve: https://www.khanacademy.org/economics-finance-domain/macroeconomics/income-and-expenditure-topic/macroeconomics-keynesian-economics-and-its-critiques/a/the-phillips-curve-cnx https://www.khanacademy.org/economics-finance-domain/macroec... ; understanding and using that is how Western central banks have tamed inflation and reduced the impact of the business cycle. Venezuela (and almost all the classic hyperinflation cases) are forex crises. You can't print foreign currency, which you need to buy goods on the international market; and the collapse by mismanagement of Venuela's oil industry and any other export industries means that the currency is just going to keep devaluing as the trade fails to balance. > That salaries are picking up doesn't mean real salaries have improved. It is however a necessary condition for real salaries to improve that nominal salaries improve. Which needs a tight labour market.

eru 5y ago

Be careful. There's a big difference in impact of modest inflation like in the US at the moment vs hyperinflation. The Fed handled the monetary side of the pandemic reasonably well. Inflation overshot a bit, yes. But it's far cry compared to when they caused a slowdown in the housing market to become the Great Recession in 2008-ish.

thisisnotatest1 5y ago
Yes, it's exactly the same but different speeds. People with savings and salaries got a nice 7% wealth tax this year The government, with it's massive 20 trillion dollar debt, got a nice 7% write down on the debt, so they can quickly spend this voucher again in a matter of weeks.
- xref 5y ago
  As someone with student loans and a mortgage, I got a 7% write down but a 18% pay bump this year! Hope I get it for several more years to come

pjc50 5y ago

No, it's just the Philips curve: https://www.khanacademy.org/economics-finance-domain/macroeconomics/income-and-expenditure-topic/macroeconomics-keynesian-economics-and-its-critiques/a/the-phillips-curve-cnx https://www.khanacademy.org/economics-finance-domain/macroec... ; understanding and using that is how Western central banks have tamed inflation and reduced the impact of the business cycle. Venezuela (and almost all the classic hyperinflation cases) are forex crises. You can't print foreign currency, which you need to buy goods on the international market; and the collapse by mismanagement of Venuela's oil industry and any other export industries means that the currency is just going to keep devaluing as the trade fails to balance. > That salaries are picking up doesn't mean real salaries have improved. It is however a necessary condition for real salaries to improve that nominal salaries improve. Which needs a tight labour market.