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The Ultimate Guide to Inflation

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Re: The Ultimate Guide to Inflation

#111

Post by paulpauper »

deanak wrote: post #49

So far it's a lot of words and graphs with a tenuous grip on reality in a few places: > There are, however, some groups in lower income brackets that do poorly in inflationary environments. If someone doesn’t have a lot of money and lives on a fixed income in retirement, they have a lot of vulnerability to inflation. Those sorts of folks should consider owning inflation hedges to protect their lifestyle, if they expe…

Some of the assertions are questionable. college and healthcare have gone up but the amount people actually pay relative to sticker price is small . There is tons of financial aids and other deference and forbearance programs, so college is quite affordable if you finish.

Re: The Ultimate Guide to Inflation

#112

Post by forgithubs »

cortesoft wrote: post #34

I've wondered what the effect our modern digital economy has had on consumer price inflation. Normally, an increase in money supply would cause consumer goods to increase in price, since more people are able to buy them and there is a limit on how much of any particular physical good is available. This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix s…

Inflation is not always in relation directly to the price.

For example, if Netflix is able to get 10,000,000 new subscribers. It receives $100,000,000.

It can now spend $50,000,000 on new infrastructure, which will make the price rise.

Netflix can also hire for $50,000,000, which creates jobs that otherwise wouldn't exist. Those new employees, working for that new currency will spend their salaries, rising the prices.

Re: The Ultimate Guide to Inflation

#113

Post by HNfriend234 »

omalleyt wrote: post #43

Time to buy gold.

Problem with gold is that it is also inflationary only difference is it is mines that "print" more gold instead of a central bank.

Cryptocurrencies are better since they have geometric decay built into the algorithm to make them deflationary by default.

Re: The Ultimate Guide to Inflation

#114

Post by sologoub »

This chart in the expense share of a typical income illustrates a number of issues well, but healthcare stands out like crazy: https://mobile.twitter.com/_cingraham/status/123195012984367...

College, transportation and housing are all pretty high overall, but the healthcare share is just stunning. If we were looking at dramatically better outcomes or services, fine. Unfortunately, doctors get to see patients for less and less time, billing is going up and you don’t really see anything in return. Most other developed nations put a stop to this a long time ago…

Re: The Ultimate Guide to Inflation

#115

Post by km3r »

HNfriend234 wrote: post #106
mensetmanusman wrote: post #98

“ The power of technological deflation is important not to overstate, though. In everyday use, the rise of the smart phone displaced a lot of house phones, cameras, video recorders, film, CD players, iPods, beepers, radios, scanners, roadmaps, and many ATMs. They also displaced a big percentage of physical newspapers, calendars, dictionaries, encyclopedias, and books. In more niche areas they displaced some mobile ga…

This is true but it is imperative that citizens have a reliable currency to use to do transactions. This is why I think it is imperative that we transition over to cryptocurrencies that are based on strong fundamentals that make money reliable. https://en.wikipedia.org/wiki/Money

Every economy in the world has and will continue to operate with some inflation, taking away an inflationary currency is dangerous and will serve to further entrench the wealth inequality we have seen grow over the past century. Sure crypto is nice because you don't have to trust a central government, but you already are trusting that government with the other 99% parts of life, rendering this sort of moot. In addition, monetary policies in times of crisis would not work in the world of crypto. Sometimes to prevent a total collapse, the fed needs to print some money. Sure it's not the best/most perfect tool, and should be used very sparingly, but to discredit it as unnecessary is a gross misunderstanding of modern monetary theories.

Re: The Ultimate Guide to Inflation

#116

Post by victor106 »

cortesoft wrote: post #34

I've wondered what the effect our modern digital economy has had on consumer price inflation. Normally, an increase in money supply would cause consumer goods to increase in price, since more people are able to buy them and there is a limit on how much of any particular physical good is available. This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix s…

> This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix subscription, it isn't like we are going to see the price of a Netflix subscription go up because there isn't enough Netflix to go around.

Good point but you have to think that if there’s lot of demand for Netflix which means Netflix has lot of hit shows. Say their hit percentage is 10% (which is very high). Which means they have to make more and more shows to provide that number of hits to sustain so much demand. Which means more expenses, which puts pressure on them to increase the price of subscription. Which also means actors, story writers etc can charge more (as they are only a finite number of good actors etc)

Re: The Ultimate Guide to Inflation

#117

Post by kart23 »

>However, folks who had property with a fixed-rate mortgage going into the 1970s, generally did very well. The house price kept up with inflation, but the mortgage was devalued against inflation, and so home equity went up by quite a bit, along with their wages.

Being a debtor is good when inflation hits, and having an asset that has historically outpaced inflation is doubly good. I believe this is a part of why home prices are rising, people know its going to be a lucrative investment over the coming years, and the downside is minimal at low rates.

Re: The Ultimate Guide to Inflation

#118

Post by midhhhthrow »

bob33212 wrote: post #47
cortesoft wrote: post #34

I've wondered what the effect our modern digital economy has had on consumer price inflation. Normally, an increase in money supply would cause consumer goods to increase in price, since more people are able to buy them and there is a limit on how much of any particular physical good is available. This isn't the case, however, for digital goods. If there are suddenly 100 million new people who want to buy a Netflix s…

We are entering a Post Scarcity Economy. A lot of fiction books write about how this plays out. Regardless of what happens a lot of economic theory becomes less relevant. https://en.wikipedia.org/wiki/Post-scarcity_economy#:~:text=... .

It’s just the opposite. The essential goods needed for survival: shelter is becoming more and more Scarce. 34% of millennials can’t even afford their own shelter anymore and are forced to live with parents. Those who can live by themselves are paying over 40% of their income on shelter. There’s been a pretty dramatic drop in living standards here in the US over the last several decades

The fact that we can now afford ever more borderline useless apps, clothes and electronic gadgets doesn’t help much

Re: The Ultimate Guide to Inflation

#119

Post by neuroma »

sologoub wrote: post #114

This chart in the expense share of a typical income illustrates a number of issues well, but healthcare stands out like crazy: https://mobile.twitter.com/_cingraham/status/123195012984367... College, transportation and housing are all pretty high overall, but the healthcare share is just stunning. If we were looking at dramatically better outcomes or services, fine. Unfortunately, doctors get to see patients for less…

I presume you are in the USA. I watch and marvel at how the USA has such expensive health care and yet apparently has poorer outcomes than other G10 nations, in aggregate. The NHS in my home country is undergoing privatisation of the more lucrative or self-contained components. But it seems important for other countries to watch and learn from this example because free market economics are so often heralded as a solution to inefficiency, cartels, and high prices. Why healthcare is not as amenable to the benefits of capitalism is no doubt complex, but if I may speculate, I'd suggest that choice is not really a good thing in healthcare. All we want is good care, and we want it quickly and conveniently. Choice is only needed if we are getting poor care. Furthermore, the infrastructure (buildings, equipment, supply chains, specialists) are sufficiently costly that often the market cannot entertain multiple variations. In other words, we can't always have many equally equipped hospitals competing to do the same things.

Re: The Ultimate Guide to Inflation

#120

Post by boomboomsubban »

qsort wrote: post #107
bob33212 wrote: post #47

Earlier quoted context omitted.

We are entering a Post Scarcity Economy. A lot of fiction books write about how this plays out. Regardless of what happens a lot of economic theory becomes less relevant. https://en.wikipedia.org/wiki/Post-scarcity_economy#:~:text=... .

Quote: This article is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor's personal feelings or presents an original argument about a topic. Please help improve it by rewriting it in an encyclopedic style. (January 2021)"

They directly linked to the definition, which is not written like a personal reflection.
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