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You give too much credit to the financial system in regard to investment. Inflationary policy just makes the money a bad thing to hold on to, a "hot potato". Th
by userulluipeste 13y ago
You give too much credit to the financial system in regard to investment. Inflationary policy just makes the money a bad thing to hold on to, a "hot potato". This is what contributed (among other things) to housing bubble as people looked at real estate properties as safe deposits, not necessarily because they needed the houses. I presume however that you didn't counted housing bubble as "investment rush".
- rsynnott 13y agoWalk into any independently owned shop (and most chains) in the developed world, and notice the large amount of non-perishable stock on the shelves. That isn't there because the owner saved up a few million prior to opening the shop, it's there because of a revolving credit facility provided by a bank. The bank can provide this at affordable rates due to cheap credit, which is a result of a mildly inflationary economy.
- userulluipeste 13y agoYou seem uncomfortable talking about the negative side of due-to-inflation "investment drive", the one that has negative impact on society, and keep mentioning again about the good part/cases instead. I got it first time - investment banks, through the power and leverage allowed and granted by legislative framework, contribute to investments. I am not denying that! But well, the consequence of inflation are not limited to the PR-stories, like or not. Also, I believe the down-voting in my previous comment was because some took my comment personal, not because it had something condemnable in it.