| Yes, salaries are a variable, but even if salaries do rise in sync with inflation, that doesn't make inflation good. It's still bad. Nope, we can't expect our salaries to rise along with inflation - not in today's insane world. - http://www.pewresearch.org/fact-tank/2014/10/09/for-most-workers-real-wages-have-barely-budged-for-decades/
- http://www.theguardian.com/money/2011/nov/23/uk-household-earnings-fall
.. and whatever you'd feel like Googling up.>> There are advantages to inflation. One is that it encourages people to keep their wealth invested in production That's not an advantage. Inflation does punish saving (which is bad to begin with), but also encourages risky investments. The higher the inflation, the higher the return on investments you need to not lose wealth, and the riskier your investments, the more likely you're to lose them. So no, that's not good. Purchasing power increases are good. >> Another is that it discounts debt. Yes, this is why governments keep lying to us that inflation is good for us. They're trying to manage their massive debts, but they'll ultimately fail. How about just not using money you don't have, or money you can't afford to borrow? Oh but that would curtail politicians' crony-capitalist spending, so we can't have that. >> The ideal would be a money supply that exactly kept pace with growth in production resulting in neither inflation nor deflation You're basically suggesting that our purchasing power should not increase. That's just absurd. >> Because mild inflation is not particularly harmful So even you acknowledge that it is harmful, even if not to a large extent. But what do you get if there's 2% inflation for 10 years? It keeps compounding you know. How much of your purchasing power will you have lost by then? >> deflation is really bad No it's not. It's your purchasing power increasing. Everyone wants to get more for less, and that's what (price-)deflation means. |