Post
Topic
Board Economics
Re: Is the US Moving Away from Capitalism and Free Market?
by
figmentofmyass
on 27/05/2020, 17:43:16 UTC
i suppose a 3rd idea would reinforce the notion that it isn't inflation per se that's the problem, but rather unpredictable and high inflation. i've heard convincing arguments that a 0.5% or 1% perpetual, but unquestionably stable/predictable inflation (like monero's tail emission) is superior to bitcoin's fixed supply dynamic.
Inflation != Increase money supply mate

there are two types of inflation---monetary inflation and price inflation.

https://en.wikipedia.org/wiki/Monetary_inflation
https://en.wikipedia.org/wiki/Inflation

they are directly related:

Quote
Monetary inflation is a sustained increase in the money supply of a country (or currency area). Depending on many factors, especially public expectations, the fundamental state and development of the economy, and the transmission mechanism, it is likely to result in price inflation, which is usually just called "inflation", which is a rise in the general level of prices of goods and services.

this is exactly why people fear that money printing policies will result in high inflation or hyperinflation. increasing the money supply devalues each unit of money, increasing prices.

Perhaps the focus should be to increase productivity (more goods and services), not to tweak the emission rates.

the fundamental problem presently is that people are spending less money on goods and services, due to high unemployment and lack of confidence in the future.

we already have a problem of too much productivity. there is no demand for the current level of productivity, which is why there are so many layoffs happening. you can't get people to buy stuff they don't want just by making more of it.