Breezy on Nostr: When using a money that loses purchasing power constantly, people work, save what is ...
When using a money that loses purchasing power constantly, people work, save what is left after expenses, then invest so that purchasing power is preserved.
If someone could choose another system where the purchasing power is constant over time, people would still work, save what is left after expenses, but not feel obligated to invest to preserve purchasing power.
Advantages
people could create more income if desired when there is no need to spend time learning how to invest, paying financial advisors, risking capital in investments that are hard to understand.
the financial economy would shrink, the corruption of the financial interests influencing politicians could possibly shrink
people could work less and have the same quality of life, spending time on things that bring value but not in a monetary sense
If the money acuatally increases in purchasing power over time, the points above are still true. The difference is that, investments will need to have returns that are more than the background productivity growth (increase in purchase power of the money) for the risk-taking to make sense.
If someone could choose another system where the purchasing power is constant over time, people would still work, save what is left after expenses, but not feel obligated to invest to preserve purchasing power.
Advantages
people could create more income if desired when there is no need to spend time learning how to invest, paying financial advisors, risking capital in investments that are hard to understand.
the financial economy would shrink, the corruption of the financial interests influencing politicians could possibly shrink
people could work less and have the same quality of life, spending time on things that bring value but not in a monetary sense
If the money acuatally increases in purchasing power over time, the points above are still true. The difference is that, investments will need to have returns that are more than the background productivity growth (increase in purchase power of the money) for the risk-taking to make sense.