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I made that comment because I know people are going to use the linked example of what happened in Argentina as the predicted fate of what will happen in the US.

by slg 5y ago

I made that comment because I know people are going to use the linked example of what happened in Argentina as the predicted fate of what will happen in the US. That seems to be what you are implying here by drawing parallels between the two. But I simply want to make it clear that the US is at 8% inflation for the last year while Argentina spent decades with the average annual inflation rate measured in the hundreds. The two aren't close to the same.

koolba 5y ago
> But I simply want to make it clear that the US is at 8% inflation for the last year while Argentina spent decades with the average annual inflation rate measured in the hundreds. The two aren't close to the same. “How did you go bankrupt?” Bill asked. “Two ways,” Mike said. “Gradually, then suddenly.”
- 542458 5y ago
  With all due respect, I feel the quote is a bit pithy here. Not all things which are gradual become sudden, and the quote doesn’t give any proof that this is one of those things.
- slg 5y ago
  Well I guess I shouldn't spend money on food this week as that is a gradual step towards bankruptcy.
  - xtracto 5y ago
    On the contrary, investing in cans of beans may offer a great way to protect your wealth from inflation. They may be a non-deprecating asset.
frostwarrior 5y ago
Yes. AFAIK inflation in Argentina is a chicken and egg problem. The government prints money, not to have more, but to force economic movement from below. More money handed through social welfare means more money in lower classes hands, and that means more people buying new things and local market activity. The government does that because most companies with the financial power to invest are be very reluctant to invest in a such unstable economy. Also, most individuals with more money will quickly move the cash somewhere abroad. So, companies don't invest and richer people are quick ot move their money elsewhere. If the government doesn't act, the economy stalls. But now because the government printed more money, the peso is now less valuable and the economy is now more unstable, feeding this feedback loop.

by slg 5y ago

koolba 5y ago

> But I simply want to make it clear that the US is at 8% inflation for the last year while Argentina spent decades with the average annual inflation rate measured in the hundreds. The two aren't close to the same. “How did you go bankrupt?” Bill asked. “Two ways,” Mike said. “Gradually, then suddenly.”

542458 5y ago
With all due respect, I feel the quote is a bit pithy here. Not all things which are gradual become sudden, and the quote doesn’t give any proof that this is one of those things.
slg 5y ago
Well I guess I shouldn't spend money on food this week as that is a gradual step towards bankruptcy.
- xtracto 5y ago
  On the contrary, investing in cans of beans may offer a great way to protect your wealth from inflation. They may be a non-deprecating asset.

frostwarrior 5y ago

Yes. AFAIK inflation in Argentina is a chicken and egg problem. The government prints money, not to have more, but to force economic movement from below. More money handed through social welfare means more money in lower classes hands, and that means more people buying new things and local market activity. The government does that because most companies with the financial power to invest are be very reluctant to invest in a such unstable economy. Also, most individuals with more money will quickly move the cash somewhere abroad. So, companies don't invest and richer people are quick ot move their money elsewhere. If the government doesn't act, the economy stalls. But now because the government printed more money, the peso is now less valuable and the economy is now more unstable, feeding this feedback loop.