4 ms·
Putting money into asset markets causes "asset inflation" (see Nasdaq skyrocketing, until recently), putting it into "peasant hands" causes "peasant goods" infl
by 988747 4y ago
Putting money into asset markets causes "asset inflation" (see Nasdaq skyrocketing, until recently), putting it into "peasant hands" causes "peasant goods" inflation (hence the food or gas prices rising).
- AlexandrB 4y agoAt least part of this doesn't make sense. Why would giving people more money cause food price inflation? Were they not eating before? Did the demand for food skyrocket because people had money? Unless you're suggesting that food prices rose because food producers saw they were leaving money on the table, but this seems like a problem that could be solved with antitrust since collusion would be required to "artificially" raise prices in concert.
- creato 4y agoPeople change their food choices when they have more money, yes.
- robertlagrant 4y agoFMCG businesses try extremely hard to keep their costs low because their margins are razor thin, because competition means they must. If people feel comfortable paying even slightly more for goods, then the massive efforts to keep prices down can relax ever so slightly, and they can make more money in other areas (e.g. putting the money into decor or other nonessential feelgood factors that consumers will prioritise over prices).
- dgb23 4y ago"Peasant goods" rise in price because the owners demand it after seeing an opportunity to do so. They could just keep stable. What is happening since half a century is that wealth gets shoveled to the top, with the above mechanism plus many others, while "peasants" can't afford their own place and education for themselves and their children anymore. They get cut off from sustainable spending and get turned back into pre-war wage slaves. What will happen is either owners getting to their senses and stop extracting so much god damn stuff for themselves for no reason, or workers rising up. Hiding behind political BS and pseudo science is a short term strategy that always ends in tears.
- AstralStorm 4y agoAlso it's probably educational that the "peasant good" that exploded is actually fuel, which has far reaching consequences, and zero rationale for getting more expensive. What that did was vacuum a lot of money off the market, additionally causing compensatory raised prices because there's an excuse. The market never works on supply and demand, not even money, it works on increasing prices every other excuse to the maximum level unless it's forced not to.