The bitcointalk forum is comprised of diverse people from all over the world. Our countries' must have gone through inflation as a nation at least once or more since its history. As a refresher, inflation happens when the prices of goods and services rise and people can no longer afford those items because the country's money almost becomes useless. But is inflation needed? Why can't we just keep the currency at the same value? And why does it only happen to money? For example, the same wouldn't happen if we used gold as a currency instead. Is inflation a ploy that the government uses so people don't get rich off of savings?
Economics is quite complicated and I'm not an expert but inflation is the result of ever increasing demand. Like the interest rates on loans in bank increases when the demand for loan is high and in high loan demand, the interest on saving increases too.
When the demand for product and services increases, the price for it increases as more people would want to acquire the limited product and service and as the price increase, the business of producing that product and services looks profitable and more people are involved in production in anticipation of demand.
Natural inflation is increase in demand.