Joining Apple 40 years ago

> That's under 3% inflation which is a not breathtaking.

Perhaps it is better to say that I am caught off-guard by the power of compound interest.

> The Fed targets 2%, which helps avoid deflationary spirals and helps both stability and lowers unemployment, two of their mandates.

I am generally skeptical of the Fed, but that's an entirely different discussion, so I'll just nod my head and move along.

> Wages have surpassed inflation in just about every income bracket for the past 100 years. And when you factor in total remuneration, returns to workers are even higher. Here's 50+ years of data [1]

That is good to see, thanks!

> No one in their right mind holds cash savings for 35 years. It's a ludicrously long time to simply hold your savings in a cash pile.

True, but people do usually place their money in a savings account. And while in theory the interest from the savings account should exceed inflation, it seems to me the mere fact of inflation means that people who have primarily cash savings are needlessly penalized.

But while it is absurd to store you money in a coffee can in the shed for 30+ years, I'm not sure it should be.

I am pleased at his positive attitude. There are many events that could have embittered him, but he writes them off as life lessons.

Minneapolis is a glorified suburb unfortunately. I grew up in North Minneapolis without a car and know very well first hand how the no-car lifestyle works even in the most well-serviced and dense areas on offer. That's ignoring the weather.

However, if you enjoy that style of living I do agree it might be one of the best places in the nation. If I ever get tired of urban living I plan on moving back.

>but people do usually place their money in a savings account.

No, they don't. Some people have some money in saving accounts, but the VAST majority of people's savings are in houses and in retirement plans, which are not cash holdings. Only a very small amount of people have the majority of their savings only in cash for periods long enough that compound inflation kills the savings.

As to things like the Fed, and inflation:

Every single country in the world has chosen to use central banking due to the lessons learned over the past few hundred years, and especially during the Great Depression, that having a politically independent central bank target low inflation results in the most stable, predicable economy. It gives decent ability to balance shocks, lower unemployment, make business smooth and predictable, and avoid deflationary spirals, which are devastating. Compared the period right before the world started understanding how this can work, there is no question that volatility and destructive cycles are now vastly better.

I get the idea that you have not ever studied economics, especially monetary policy, but just like you probably have not studied quantum physics or brain surgery or ancient Egyptian hieroglyphics, just know that mankind has put tremendous effort into all of these and has learned some very useful things.

So - given that centuries of good thinkers following centuries and hundreds of countries of evidence have come to the conclusion that low inflation and central banking are wise, and not the product of conspiracy Illuminati nonsense, then you should adjust your beliefs that this is wise, in the same way you'd understand medicine, physics, math, etc., are all studied and the experts do indeed understand them vastly better than the general populace.

Thus, since there will be targeted inflation of around 2%, it is dumb to assume one should simply save all their money as cash. Invest it in broad index funds, or something similar.

>I am caught off-guard by the power of compound interest.

All the more reason to not hold cash, which has zero reason to grow, and has a very solid reason to shrink in buying power, and invest in productive assets with savings. The compound growth of productive assets then works for you, not against you.

>But while it is absurd to store you money in a coffee can in the shed for 30+ years, I'm not sure it should be.

It is absurd given the rest of the evidence around us.

> I get the idea that you have not ever studied economics, especially monetary policy

That is one hell of a presumption. Did I offend you?

> but just like you probably have not studied quantum physics or brain surgery or ancient Egyptian hieroglyphics, just know that mankind has put tremendous effort into all of these and has learned some very useful things.

This is a complete non-sequitor. It's physics envy and posturing nonsense. The successes of physics and medicine have no bearing on whether mainstream economics is a complete crock. In the soft sciences like economics, the expert doesn't necessarily bring more to the table than the reasonably well-read layman. I'm not saying there is no value in studying these subjects, but the collective "expert opinion" is not in anyway "science".

Maybe you should study some philosophy?