Quote from: kkaspar on February 18, 2014, 07:30:55 AM

Quote from: Wekkel on February 18, 2014, 07:11:15 AM

If nobody would spend money because of a rising value of money, that money would - in the end - buy less again because the economy is not growing but shrinking. Of course, this is a contradiction. No such thing will happen. Instead, an equilibrium will exists that indeed differs from our current system.

Nobody will hoard money indefinitely. There is a simple reason for this: time.

Nobody lives forever, right?

Well, someone will always buy something. Just less people buy something.
When inflation motivates people to consume more, then you can be sure that deflation will motivate people to consume less. Of course there won't be radical outcomes that no money will be spent, but a country that runs on deflationary currency, will fall behind in economic development compared to countries with inflationary currency.

It's like with communism or just plain old socialism, where everyone will work less and work is less important in society in general, but everyone are also poor because the lack of quality production.
I have lived in Soviet Union, so I know how childish economic dreams can create deficit in even the most regular goods.

Well, we know for sure that we do not become richer because of money printing (inflation). Second, stimulating demand by borrowing from the future is not bringing a net positive in the longer run. Finally, my purchase decisions are not affected by a few percent of inflation. I buy if I need or want something. Inflation is mostly an annoyance to me (saving is impossible in our current system).

So to me the artificial inflation argument does nothing right. Its just a gimmick that leads to a redistribution of existing wealth. Communism has nothing to do with this.