Can inflation actually be fixed? Is there any hope? Or will prices just gradually keep increasing?
In: 45
You are getting lots of correct answers, so I’m not going to restate the 90% correct answer.
I want to add a little bit of nuance and some criticism of the confidence that everyone seems to have about inflation.
First of all all of the answers speaking as if this is a fact should all be prefaced with “according to economists” or “according to modern economics theory” or “my macroeconomics class taught me.”
Inflation (that is the cost of good and services relative to currency) does not happed across an economy uniformly. Inflation of higher education, housing and healthcare has been very high in the US for many years now. Inflation in regard to most people’s wages has been very low.
Ultimately, the hope is that wages inflate to match the new monetary costs of things, which in turn allows for things to “re-balance.”
On to a more skeptical take on “inflation”
What inflation does, in practical terms, is reduce the value of all of the money you have earned and save up to this point. In a way, it is “stealing” from actual, working-class people that are responsibly saving for a rainy day, in order to benefit the wealthy that can afford to effectively invest a large proportion of their wealth in investments that inflate faster than other things.
As a middle class person, I am at a huge disadvantage when investing to anyone with more money because I do not have the information, advisors or time to wisely invest. I am a lamb ready to be slaughtered by bigger players. This is the case with all small “investors” in most asset classes. By being forced to “invest” rather than “save” we, as the American public, are essentially supporting the lavish and wasteful lifestyles of the very wealthiest people in our society.
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