Explain inflation to me

[eggsarascal]

3 minutes ago, Sviatoslav Tulin said:

Maybe I just didn't explain correctly, I didn't say that hiper inflation is OK, but up to 10% it's bearable, last one I remember it was about that rate and lasted about 2 years, but one morning we wake up and all prices went up like 10x times, most people who didn't have savings in dollars, or German mark, lost everything including my family, we survive tough, it was still possible to get jobs and some sort of income, it wasn't easy. 

Really! 10% inflation is bearable when wages are stagnating? I've a feeling the put up and shut up attitude isn't going to last. Barristers, medical staff, rail workers, et el are on strike or being balloted to go on strike. It is not bearable for lots of people.

[Sviatoslav Tulin]

4 minutes ago, eggsarascal said:

Really! 10% inflation is bearable when wages are stagnating? I've a feeling the put up and shut up attitude isn't going to last. Barristers, medical staff, rail workers, et el are on strike or being balloted to go on strike. It is not bearable for lots of people.

Im not saying its easy, Im just saying it's better than 2008 crash, and ofc I absolutely don't want all that sh... t going on, but it's happening, ofc we need to protest and vote out people who failed, still it is not that bad yet, let's see Winter. 

[Retired Climber]

7 minutes ago, eggsarascal said:

Really! 10% inflation is bearable when wages are stagnating? I've a feeling the put up and shut up attitude isn't going to last. Barristers, medical staff, rail workers, et el are on strike or being balloted to go on strike. It is not bearable for lots of people.

You don't need to put up and shut up. It has literally, never in the history of humanity, been so easy to make money. Money is just a token we all use to play a game. Obviously some people are better at the game than others, but anyone can do well. 

[eggsarascal]

12 minutes ago, Retired Climber said:

You don't need to put up and shut up. It has literally, never in the history of humanity, been so easy to make money. Money is just a token we all use to play a game. Obviously some people are better at the game than others, but anyone can do well. 

I've always had you down as a bit of a tool, you've now confirmed it.

[Retired Climber]

11 minutes ago, eggsarascal said:

I've always had you down as a bit of a tool, you've now confirmed it.

Thanks for letting me know. 

[eggsarascal]

Just now, Retired Climber said:

Thanks for letting me know. 

My pleasure.

[Dan Maynard]

I think it's worth saying that printing money is widely accepted as an inflationary pressure, but if it were that simple there would be no professors of economics left as they'd have all got bored by Monday lunchtime and gone down the pub.

 

Different economists focus on different things, the idea that government spending causes inflation and therefore erodes wealth was pretty much a mantra in the 80s and drove politics in the UK and US. Nowadays there are some counter examples too, say after the 2008 crash an awful lot of money was printed in many countries and fears of inflation did not materialise.

 

There are other economists who challenge the 'rational' behaviour assumption that says you can look at what is happening and predict what people will do, rather you have to take into account what people believe and accept. These would say a major cause of inflation is the expectation of inflation, because people put prices up in anticipation. It's the same school of thought that a recession is a combination of many decisions not to spend, so what people believe in aggregate, and that it is possible to talk the country in to recession.

 

[trigger_andy]

2 hours ago, Steve Bullman said:

isn't hyper inflation the very definition of inflation going out of control? If not, at what rate of inflation is it considered hyper inflation?

Could do with some hyper inflation to make my mortgage virtually worthless and easy to pay off.  

[trigger_andy]

1 hour ago, Squaredy said:

I am actually a Brexiteer, but I do recognise that it has caused some increased costs.  When you move house it costs a lot of money, but we still do move house when our existing house is no longer suitable for our needs...

I guess thats a fair comment. Interestingly our 9-10% inflation is the same as the USA. Clearly not Brexit driven.  

[trigger_andy]

52 minutes ago, Sviatoslav Tulin said:

Im not saying its easy, Im just saying it's better than 2008 crash, and ofc I absolutely don't want all that sh... t going on, but it's happening, ofc we need to protest and vote out people who failed, still it is not that bad yet, let's see Winter. 

100%! We've not even felt the tip of the shafting we'll see this coming winter and beyond. Folk think saving is the answer the coming hard times, my in-laws for example. Its near on impossible to get them to understand that all their savings are being eroded at 10% a year just now. But they cant see it like that as they still have the same money in the bank.

 

I keep telling them to convert their savings into Gold but they'll not have it.