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The parent opened with "I hear this all the time. Inflation measured by CPI is not a tax on the cash held by the rich. " Which suggests that inflation will nev
by benj111 4y ago
The parent opened with "I hear this all the time. Inflation measured by CPI is not a tax on the cash held by the rich. "
Which suggests that inflation will never hurt the rich. But it will yes they are spending much of that cash on milk today. But the price of milk is rising whereas money kept in cash isn't, or at least not at the same rate. If you have a job with good pay today, would you be happy if you were told it would never rise? Sure you may be happy today, but what about in 20 years when the price of everything has doubled.
- voisin 4y agoThe rich doesn’t care about the price of milk. They care about the price of stocks, bonds, real estate, etc. which make up the bulk of their purchases. These assets have experienced deflation over the period you are pointing to the price of milk inflating. CPI inflation isn’t a tax on the cash held by the wealthy.
- benj111 4y agoWhat time period? My position is that you don't know ahead of time what assets will rise and fall, but in the long term stocks will beat inflation. And if you want to preserve your wealth so you don't have to worry about the cost of milk you will need to beat inflation. They care about stocks, bonds, and real estate precisely because of inflation. Because if they don't beat inflation they get poorer every year. If you don't invest you are guaranteed to lose to inflation, that's why people invest in riskier assets. They don't do it because it's fun.