The simple idea of you print more money therefore each dollar, euro... has less value, therefore inflation.
Works for me
Works for me
However a lowered velocity rises r - g. This exacerbates wealth inequality.
You have to explain how returns can exceed economic growth. Your returns have to be earned through coercion basically, the other party can't refuse. Overpriced stocks just result in lower yields. I can only think of real estate as something that is earning a fixed return through coercion. The other thing would be money if the fed forcibly raised interest rates but interest is already zero.
> However a lowered velocity rises r - g. This exacerbates wealth inequality.
The cantillion effect:
https://en.m.wikipedia.org/wiki/Richard_Cantillon#Monetary_t...
I borrow $100 from the bank which creates $100. I buy seeds and plant trees. I sell 100 Apples to pay the loan back. Did the value of the dollar go down? No it didn't. This is how the supply of money can go up much faster than inflation.
From a labourer's perspective, inflation is making the results from work done in the past worth less, while those who have the means to take risks can negate these negative side effects.
if there are a 100 dollars today and tomorrow there are 200. a dollars worth is halved right? or?
Got some secret insight on supply demand, that the general public is unaware of?
I would sooo like to know :-)
Inject it at ground level. No banks. No taxing. Let's come up with a few scenarios.
Everyone invests it in Stocks. Everyone saves. Everyone invests in assets to start their own businesses.
Well, this wouldn't cause any inflation at all. It's basically just dead money. Either you own a stock or you save money in your bank account because someone bought your overpriced stock.
>Everyone invests in assets to start their own businesses.
This will cause inflation over the short term if there isn't enough labor available to do all investments. Interest rates would rise to encourage people to save their money.
There is also another form of inflation. There is enough labor available but the investment fails. You borrow $100 but only repay $80 (inflation adjusted of course). There is more money without enough production to back it up.
The only time you "invest" in stocks is during a public offering. And when a company does a buyback, that's a de-vestment. Over the last 20 years there has been more buybacks than stock issuances. The market is running dry.
Deflationary assets are exactly what r > g predict.
https://github.com/freeduck/hellebrevet/blob/main/skizze.jpg
Sort of a mohammed drawing
Let's talk