“Inflation” to economists is how much the price is going up this month.
“Inflation” to most people is how much stuff costs.
It feels like there needs to be some acknowledgement of that when this is all talked about, after the superinflation of 2022. The goal should be that prices go back down, not that they go back to going up by 3% per year now that they’re way up high.
You really don’t want deflation. The correct thing now is for wages to go up to match the new costs and this has been happening.
That’s not really true though. The only way to maintain infinite inflation is with infinite growth. But we only have finite resources. We also have modern examples of countries that experience deflation and they aren’t the horror shows that the finance industry wants about. For example, Japan.
The only way to maintain infinite inflation is with infinite growth
No - monetary policy also effects inflation. See also “stagflation”.
We also have modern examples of countries that experience deflation and they aren’t the horror shows that the finance industry wants about. For example, Japan.
It doesn’t have to be a “horror show” for it to be “bad”. Japan’s “lost decades” are hardly desirable.
Deflation would mean money is worth more. Great! But then prices drop. And then salaries drop. And now the ability for somebody to pay back a 30-yr. fixed mortgage gets harder over time rather than easier as it does in an inflationary environment.
So yeah - I’d rather a pay rise to match (or hopefully exceed) inflation that makes it easier for me to repay loans.
News flash, most Americans were paycheck to paycheck before inflation, too.
“inflation has slowed, but prices are still high? Why is that?”
literally the title of this thread/article
Man i sure wonder why my rate of increase % lowering hasn’t done much to change the value that it’s cumulatively adding on top of…
They were doing that too begin with though?
Yeah. Because wages have remained stagnant, or even decreased relative to prices. Inflation is supposed to be a response to people making more money, but that never happened. So now we’re all just effectively poorer.
