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Cake day: July 17th, 2023

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  • Even if the value of money goes up, it’s by a paltry 1-2% and it still wouldn’t seem to make sense to hoard rather than invest, unless I’m missing something. In what scenario would any rich person just sit on their money? Likewise, the impact of 2% deflation on a bank loan is well within the variance in rates we see today, and I imagine in such an economy the rates would be adjusted somewhat to compensate.

    Simply put, the difference between an inflating vs deflating currency doesn’t seem enough to drastically alter people’s behavior. In the short to medium term it seems almost a non-issue, at least for regular people, and in the long term people won’t get fucked out of their life savings. I imagine the vast majority of the population doesn’t invest their money. Which policy would they prefer?