Could you elaborate on this for someone with no prior knowledge of what you're referring to?
And then extending that, one could make the argument (and cryptocurrency maxis frequently do) that inflation is really only good for the existing upper class, who like it because it makes it easier to pay off their debt (of the "building a factory" variety, not credit cards) and because the wealthy own most real assets (e.g. property) that don't get devalued by inflation.
I haven't done enough analysis myself to say whether I think this argument holds water, but that is the argument I assume GC would make and I've done my best to steelman.
There were plenty of "periods of stagnation" in that time interval, though.
In general, stable money income flows promote economic resiliency far more than stable prices do. This means a rising price level (inflation) when the economy is hit by real-world constraints such as war or disasters, and stable or even falling prices when there is a lot of real growth. Pegging the value of the US dollar to gold led to an economic disaster in the late 1920s as the Banque of France was hoarding a lot of gold in a futile attempt to re-establish "sound" money after WWI. Widespread devaluation in the 1930s made it possible to stabilize nominal income flows again, which had beneficial effects even though it came with some mild price rises.
It's pretty obvious what the problem is. If the value of the money is kept stable while the real world deteriorated (through unemployment) then A becomes a leech on productivity or productivity growth. I.e. the way he is maintaining his savings is by exploiting the slack in the labor force. Thus anyone who wants to save in USD is dependent on an underclass that willingly sacrifices their labor. I don't see how this benefits poor people. I can kind of see how this benefits a middle class founded on exploitation. I definitively don't see how reducing the savings until they reach their real value benefits an upper class. They are the ones that want their money to be stable because it means they can extend debts arbitrarily long into the future at their own whim.
Anybody know any good treatises on inflation?
BTW, that's one of the things that make me so excited about DEFI – bringing even more financial instruments previously only available to the rich for wide masses.
The problem with many financial instruments being available is that, because there isn’t anything very interesting to say about “normal” investment, someone reading about investing (or talking to some financial advisor trying to sell them something) will think that it is sensible to be picking investments in various new or weird instruments. The incentives don’t work for the cover of every issue of Barron’s to say “yep, people should probably just invest in broad-ranged low-fee index funds”[2].
But maybe it is hard to stop people from foolishly getting involved in these sorts of schemes and instead of weird financial instruments they will be convinced to make “totally safe but high interest” loans to obviously dodgy companies.
[1] I might back down from this a bit and allow normal equities but not penny stocks and definitely not options. I’m not suggesting no one should be able to get involved but rather that it should be somewhat inconvenient to do so, eg maybe you need to turn up to some office in person or send in a form and wait 2 months (as opposed to the system of “accredited investors” who just need to be somewhat wealthy, a requirement that cuts out people who could make good decisions while still allowing plenty of dentists to be duped into stupid schemes.)
[2] Maybe Barron’s is a slightly bad example as their focus is on financial markets, but you could imagine instead the personal finance section of a regular newspaper.