BitcoinMike on Nostr: when i see these articles i scratch my head about how little writers and even ...
when i see these articles i scratch my head about how little writers and even economists understand about Inflation, simply put it goes up forever, period! How can inflation be transitory if it's a mandate to keep it at 2 percent. Transitory for 100 years?
Let’s do some math
You have 1000 dollars
The standard inflation is 2 percent which means the next year 1020 dollars buys you what previously bought you 1000 dollars.
Inflation spikes to 10 percent now 1122 buys you what 1020 did.
If they bring it back down it’s 2 percent of 1122 which is 1144.44 (btw all they do to bring it down is raise interest rates to stop people from borrowing and sell treasury bonds that no one wants, what happens when no one wants those bonds) in reality nothing really brings it down.
It compounds constantly. Our brains do not understand this at all. Nothing returns to its original levels. So when I hear any politician talk about how they reduced inflation I think about how people think they can manipulate math.
Over a 7-10 year span prices double.
This is the same nonsense that keeps you paying credit cards forever. credit card companies don’t want you to pay them off, they want the interest and free money. They rent seek off people. Same with mortgages, you end up paying double for your house over thirty years. Ever pay a bill you feel like you’re paying down and next month it’s the same? Everyone has felt that.
Eventually this breaks because it compounds so rapidly that the consumer/market can’t handle it.
Here’s the truth, INFLATION SHOULDNT EVEN EXIST! Inflation only exists because of printed money, the corporation profits that we all complain about are the result of the printed money not the other way around because they own the hard assets that go up in value. Go deeper than just corporate profits. You can’t redistribute wealth in this system, the debt stack far too insane. it’s all a printed money illusion.
This particular issue is not a right or left issue, it’s a math and piping issue that runs far deeper. Simply put, you cant save a system from a system. All sides of the government will continue to print to avoid a credit collapse that would make the Great Depression look like child’s play.
the natural state of the world is deflation. more for less. your iphone in 1950s terms is a trillion dollars, but today you get it for 1000 dollars. The world wants to give you more for less but the printing of dollars wont in key areas like food, rent, groceries. Meanwhile TVs and tech get cheaper because they move at rapid deflation speeds.
Let’s do some math
You have 1000 dollars
The standard inflation is 2 percent which means the next year 1020 dollars buys you what previously bought you 1000 dollars.
Inflation spikes to 10 percent now 1122 buys you what 1020 did.
If they bring it back down it’s 2 percent of 1122 which is 1144.44 (btw all they do to bring it down is raise interest rates to stop people from borrowing and sell treasury bonds that no one wants, what happens when no one wants those bonds) in reality nothing really brings it down.
It compounds constantly. Our brains do not understand this at all. Nothing returns to its original levels. So when I hear any politician talk about how they reduced inflation I think about how people think they can manipulate math.
Over a 7-10 year span prices double.
This is the same nonsense that keeps you paying credit cards forever. credit card companies don’t want you to pay them off, they want the interest and free money. They rent seek off people. Same with mortgages, you end up paying double for your house over thirty years. Ever pay a bill you feel like you’re paying down and next month it’s the same? Everyone has felt that.
Eventually this breaks because it compounds so rapidly that the consumer/market can’t handle it.
Here’s the truth, INFLATION SHOULDNT EVEN EXIST! Inflation only exists because of printed money, the corporation profits that we all complain about are the result of the printed money not the other way around because they own the hard assets that go up in value. Go deeper than just corporate profits. You can’t redistribute wealth in this system, the debt stack far too insane. it’s all a printed money illusion.
This particular issue is not a right or left issue, it’s a math and piping issue that runs far deeper. Simply put, you cant save a system from a system. All sides of the government will continue to print to avoid a credit collapse that would make the Great Depression look like child’s play.
the natural state of the world is deflation. more for less. your iphone in 1950s terms is a trillion dollars, but today you get it for 1000 dollars. The world wants to give you more for less but the printing of dollars wont in key areas like food, rent, groceries. Meanwhile TVs and tech get cheaper because they move at rapid deflation speeds.