Inflation is not ontologically evil. The problem is that we have this Bizarro world version of inflation where everything keeps getting more expensive, unless it’s an hour of our labor.
In a world where wages rise in line with costs, inflation actually benefits workers, because generally speaking our debt to savings ratio is much higher. Inflation reduces the comparative size of your debts. If you buy a house for $500,000 today, and then over the next ten years your income doubles, in effect the price of your house has halved. Ditto cars, student loans, medical debt, etc.
The problem is not the inflation itself, but the suppression of wages. That’s what’s actually killing us.
NB: This does not imply that inflation is ontologically good either. Just that, under the right conditions, it can be beneficial.
Well… Not exactly.
Inflation is not ontologically evil. The problem is that we have this Bizarro world version of inflation where everything keeps getting more expensive, unless it’s an hour of our labor.
In a world where wages rise in line with costs, inflation actually benefits workers, because generally speaking our debt to savings ratio is much higher. Inflation reduces the comparative size of your debts. If you buy a house for $500,000 today, and then over the next ten years your income doubles, in effect the price of your house has halved. Ditto cars, student loans, medical debt, etc.
The problem is not the inflation itself, but the suppression of wages. That’s what’s actually killing us.
NB: This does not imply that inflation is ontologically good either. Just that, under the right conditions, it can be beneficial.