What is it for and why? I found a lot of questions on interest rate but not what interest itself is
Thanks in advance 🙂
Edit: Thank you for all the replies i am now a financial god of wisdom, i’m not going to reply to unless something is unclear to me but comments will all be read
In: 9
Interest exists because not all money is equal.
Money today is worth more than money tomorrow .. why? Inflation. This is more relevant now especially as covid has forced our government to print print and print more money for subsidies.
Give me $100 of your money today.
I’ll give you back $120 of 2023 dollars.
The person giving the loan is expecting that 20% return will outpace 3% inflation and poof you have profit.
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