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The money I saved as a child would buy one picogram of gold today

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Re: The money I saved as a child would buy one picogram of gold today

#31

Post by UncleMeat »

treeman79 wrote: post #11
slg wrote: post #9

Argentina has experienced multiple rounds of hyperinflation due to failed monetary policy. Saying this story is a "lesson about the power of inflation" is like saying "the sun is hot". Yes, it certainly is, but it is so far beyond normal definitions of "hot" that people will have a hard time understanding it. This is more a story about the failures of Argentina's governments over the last 50 years than a story about…

There are a lot of people that think we can print spend endless amounts of money without consequences. Heck an alarming amount of people don’t understand that bonds need to be paid back.

That's true, but there aren't a lot of these people in positions of great policy power.

Re: The money I saved as a child would buy one picogram of gold today

#32

Post by Jiro »

Taek wrote: post #12
Certhas wrote: post #8

Earlier quoted context omitted.

As a childhood lesson you don't need crazy inflation for this to hold true though. Anything that takes more than a few of months to save up to just doesn't make sense as a kid. Your disposable income goes up by factors of ten every few years. You have 2$ to spend at 5, 20$ at 10, 200$ at 15. Then it slows down but you might still get to 2000$ at 25. Saving as a kid really never seemed worth it to me.

It's about the lesson more than anything else. I really want my kids to learn how to save and be well practiced at it, even though the utility function doesn't make a ton of sense.

Learning to manage money includes making correct decisions about whether a course of action is worth it. Forcing a child to save when he'd be better off not saving teaches the right lesson about what saving is, and the wrong lesson about when you should save.

Re: The money I saved as a child would buy one picogram of gold today

#33

Post by epgui »

Taek wrote: post #12
Certhas wrote: post #8

Earlier quoted context omitted.

As a childhood lesson you don't need crazy inflation for this to hold true though. Anything that takes more than a few of months to save up to just doesn't make sense as a kid. Your disposable income goes up by factors of ten every few years. You have 2$ to spend at 5, 20$ at 10, 200$ at 15. Then it slows down but you might still get to 2000$ at 25. Saving as a kid really never seemed worth it to me.

It's about the lesson more than anything else. I really want my kids to learn how to save and be well practiced at it, even though the utility function doesn't make a ton of sense.

I don’t understand why so many people “save money” but then just keep cash under a mattress or in a savings or checking account.

If you want to win at life, you “save money” by purchasing non-cash assets like stocks.

Re: The money I saved as a child would buy one picogram of gold today

#37

Post by mlyle »

Certhas wrote: post #8
t43562 wrote: post #3

I remember my dad encouraging me to save my dollars and not spend them on choc-99 double ice-creams ($2.13). These were soft whip ice-creams with 2 cadbury's flake chocolates stuck in the side and they seemed like the closest thing to heaven on earth to me. What my dad said seemed logical though and I saved. When I was 16 I had a holiday job that earned me many ice-cream-worths but I kept it - didn't buy a bicycle or…

As a childhood lesson you don't need crazy inflation for this to hold true though. Anything that takes more than a few of months to save up to just doesn't make sense as a kid. Your disposable income goes up by factors of ten every few years. You have 2$ to spend at 5, 20$ at 10, 200$ at 15. Then it slows down but you might still get to 2000$ at 25. Saving as a kid really never seemed worth it to me.

One of the biggest factors for success in life is the ability to cope with delayed gratification and to show restraint.

Yes, opportunity cost is huge for kids, and they might rationally spend all money immediately. But that's still not what we encourage...

So we'll put our finger on the scale and adjust situations to make saving beneficial.

Re: The money I saved as a child would buy one picogram of gold today

#38

Post by imtringued »

throwuxiytayq wrote: post #7
t43562 wrote: post #3

I remember my dad encouraging me to save my dollars and not spend them on choc-99 double ice-creams ($2.13). These were soft whip ice-creams with 2 cadbury's flake chocolates stuck in the side and they seemed like the closest thing to heaven on earth to me. What my dad said seemed logical though and I saved. When I was 16 I had a holiday job that earned me many ice-cream-worths but I kept it - didn't buy a bicycle or…

Quoted post unavailable.

>Inflation is theft. Prove me wrong.

Money is a claim on people's time and we haven't invented cryogenic chambers and demanded that the unemployed enter those cryogenic chambers during their time of unemployment to prevent them from aging, ahem, I mean stealing the value of your money.

As it stands right now, labor cannot be stored. Your money must age at the rate people age if nobody is hiring the unemployed for investments. What I personally find particularly amusing is that there are so many branches of economics (I could Marxism as one) that postulate that money is just a medium of exchange and thus can't be harmful.

Yet internet forums are filled with angry savers that want to use their money for anything other than a medium of exchange.

> Right now I'm looking at Turkey - I honestly can't tell whether Erdoğan is just a trickster, or actually fucking retarded. Likely both.

If he introduces a debt brake then lowering interest rate for government bonds is the right strategy. The interest that you don't have to pay can be used to pay down the principal and reduce debt faster than paying interest could ever achieve. The problem is that he isn't doing a debt brake at all.

Re: The money I saved as a child would buy one picogram of gold today

#39

Post by sitkack »

UncleMeat wrote: post #31
treeman79 wrote: post #11

Earlier quoted context omitted.

There are a lot of people that think we can print spend endless amounts of money without consequences. Heck an alarming amount of people don’t understand that bonds need to be paid back.

That's true, but there aren't a lot of these people in positions of great policy power.

/s naaap!

Re: The money I saved as a child would buy one picogram of gold today

#40

Post by Retric »

jonhohle wrote: post #21
Certhas wrote: post #10

Earlier quoted context omitted.

I looked up the definitions: Theft: an unlawful taking (as by embezzlement or burglary) of property. Inflation: a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services. There you go, proved you wrong.

I don’t disagree that it’s not, by definition, theft. It is, however, an obscured tax on savers, a transfer of wealth from lender to debtor. At least in the US inflation is the result of decoupling dollars from gold and the direct theft of gold and silver from the citizens by the government.

It’s a tax on people holding the currency not all savers. Hold stock, a different currency, copper, paintings etc and you avoid losing out to US inflation.
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