Hacker News new | ask | show | jobs
by oscardssmith 1776 days ago
Inflation is mainly bad for the rich. About half of Americans have essentially no savings. For them, increased wages and inflation is a massive win.
1 comments

What? This is wrong on so many levels. Inflation (dilution) is far more damaging to the lower income ranges. Inflation is also the reason that half of Americans don't have savings. What little is earned buys less each year. Since earned dollars buy less the longer they are held people are encouraged to spend quickly. So, inflation makes it harder to save and makes saving ineffective.

Higher income ranges are able to save by purchasing physical assets that can later be sold for inflated dollars. But, inflation is damaging to higher income purchasing power as well. There is just more breathing room in higher income ranges. Middle class becomes lower class unless they can manage to earn more.

Inflation is a loss for all but a few. Everybody becomes more poor through inflation with the exception of people closest to the new money. Those closest to new money get to spend it before prices increase.

>Inflation is also the reason that half of Americans don't have savings. What little is earned buys less each year.

Wages grow more than prices rise. It would be a better outcome for lower income ranges.