It's not about the stuff that just cancels out, it's about everything that doesn't.
Money you already owe becomes more expensive to pay back.
It turns the currency into an investment vehicle that competes with economically productive activity for investment. If cash in a mattress predictably appreciates by 4% a year then nobody will be willing to invest in anything that produces less than that in real returns, so all of that productive activity disappears out of the economy to be replaced by currency speculation. Or is forced to pay the higher returns to investors by paying lower wages to employees or charging higher prices to customers, and is able to because less available investment means less competition when your would-be competitors don't get funded.
When most of the currency is held by speculators it causes high volatility in the currency value, which interferes with normal businesses using it as a currency because the value can fluctuate wildly even for those who only hold the currency temporarily. Which leads to economic inefficiency and less competition again.
Everything about it causes unearned wealth to go to people who uselessly hoard currency at the expense of everyone else.
Money you already owe becomes more expensive to pay back.
It turns the currency into an investment vehicle that competes with economically productive activity for investment. If cash in a mattress predictably appreciates by 4% a year then nobody will be willing to invest in anything that produces less than that in real returns, so all of that productive activity disappears out of the economy to be replaced by currency speculation. Or is forced to pay the higher returns to investors by paying lower wages to employees or charging higher prices to customers, and is able to because less available investment means less competition when your would-be competitors don't get funded.
When most of the currency is held by speculators it causes high volatility in the currency value, which interferes with normal businesses using it as a currency because the value can fluctuate wildly even for those who only hold the currency temporarily. Which leads to economic inefficiency and less competition again.
Everything about it causes unearned wealth to go to people who uselessly hoard currency at the expense of everyone else.