The US dollar is a Fiat currency, which means it isn’t tied to any actual value but instead to debt. The fed prints the money and loans it to the government, and what makes it worth anything is that the US government(and most of the world) agrees it is worth some value. As the government prints more, it becomes worth progressively less. This is referred to as inflation, because like when you inflate a balloon you get more volume of money but the individual dollar gets stretched thinner. Inflation has historically set at about 2%, but estimates for the next few years range from 7.12%(the low-ball that the government sets) to 15%(a reasonable estimate) to 30%(based off the increased prices of gas, used cars, food, housing, and other essentials most people buy). With 15% inflation, say you have 100$, and you buy avocadoes at 1$ a pop. In 1 year, you will still have 100$, but those same avocados will be worth more, so you can only afford 85(100-15%). This is always happening, but most people don’t know about it. They think the 1% interest at the bank is great, not realizing that they are losing value even when the numbers go up.
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