Please tell me why is inflation bad and why should we have a currency with a finite amount

Implying consumerism is good.
The only thing it does is inflate market numbers before the election year and hides the real productivity/consumption rate.

How can he lend more money he actually has?

Banks are a business. They provide you with starting capital so you can get your business or greay idea into production and change the world. You just agree to pay them back eventually with interest to make up for the percieved lost time value of the money you borrowed. The free market decides what fair interest rates are and you as a borrower never have to agree to borrow money. If you can't pay it back noone comed to break your legs and you don't go to prison. Its just understandably harder to get a big loan for 8 years. Banks and intetest stimulate the economy and allow for game changing technology advancement yo happen faster. There is nothing wrong with banks.

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Yeah but don't we get richer and richer all the time? I mean we have more money than we had 100 years ago. We can buy more things

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Fractional reserve means that he only needs to keep a fraction of the total capital.
Nobody gets actual currecy when they blow their credit card for example. That number you see on the screen of the ATM machine is controlled by the bank server so they can write whatever they want there, people just use the bank as a trusted 3rd party, that is what the blockchain wants to replace user.

This is it except that you didn't explain that the ideals of limited supply, no inflation and no interest is inherently Islamic.

Unfortunately this doesn't seem to be available to us plebs. I have a business that needs capital. I never once considered using a bank.

Yeah but if the bank has 100$ how can they give me 1000$ which I can spend?

Imagine this but with Bitcoin. There could easily be the same concept enabled by private businesses, the only difference would be that they would loan their money wisely and people would use it more wisely. And the other difference is that it's actual money you're getting

That's why controlled or slow inflation is fine not ideal but fine.

The problem is when inflation happens faster than us getting richer.

I know it seems like a scam, but they can. That is called credit user.

I’ll use a different analogy. Lets say if all the people who have an accout at bank of america decided to cash out all of their savings at a give day, even if the bank sold everything they owned they still wouldn’t come up with the money.
On a larger scale, this is why the US government can have a debt that is 3x the national gdp.

Bank loans out credit, its an IOU for money. Can lend 1000$ credit for 100$ actual cash.

Fun fact: If everyone just decided one day to withdraw their money in cash the entire world economy would collapse and governments/banks would probably prevent people from accessing their money

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Part of the issue with printing money is that the more money there is going around the less value there is for the individual piece, which means inflation, which means consumer goods cost more and wages don't necessarily grow alongside that.

???

That's kinda crazy but with Bitcoin this wouldn't happen, because you cannot loan more than you have?

nvm
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And the supply is fixed and there is competition, if you don’t like btc you can use any other coin, even make your own.
If you don’t like dollars tough luck

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.... I believe that banking institutions are more dangerous to our liberties than standing armies.... The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." - Thomas Jefferson

Ok ok I think I've getting the hang of it. But Bitcoin will kinda eventually die? Or not...?
So there is a load of better cryptos than Bitcoin, but most people know Bitcoin and I think Bitcoin is accepted more widely than anything else right now, so it has an advantage?
What about Bitcoin updates, VISA makes 4000 transactions per second and Bitcoin like 5. Will Bitcoin ever be "usable" in that kind of way?

Inflation is destruction of wealth.

100 years ago a good weekly salary was 20$ and 20$ equaled 1 ounce of gold.

Today 100 years later that 20$ which used to be a good weekly salary now barely buys you lunch for two at Taco Bell.... but that gold ounce held for 100 years held its purchasing power because its real money. Because if you take that gold ounce to a coin shop you'll get $1,200 for it which is still a good weekly salary.

When congress is protecting the fed and letting them print money... the people who touch that money first benefit from it most. Then when it starts circulating in the economy there is too much money chasing too few goods and prices of everything rise.

So prices are higher and higher... but if you yourself have a money printing machine it doesn't matter what the prices are because you can just print tons of money for you and your corporate buddies and gamble in the market or buy up assets. And then stick the people with the debt

Nobody knows.
I see BTC as gold and other coins with more scalability as actual currency.

I’m pulling this out of my ass but I think in the future BTC will become a stablecoin and other coins like NANO will be currency.
If lightening network is implemented things would go the other way around.
In short, I have no fcking idea what will happen. It’s still too early

I’m not shilling Nano btw, this was an example.

Actually, what we need is a money supply that grows with the population increase. A finite currency is just as bad as a infinite currency as it favors too much deflation. This is why gold and silver are the ultimate forms of money because their supply expands with mining efforts and therefore cannot be printed at will. Historically, gold mining output has been remarkably stable relative to population increase which makes for very stable prices.

Fun Fact - You couldn't be more wrong. Most people are in debt, they have nothing to cash out.

Very stable AND low prices under a gold standard.

55 years ago you could drive retarded children on a bus to grade school for a living and "make it" with the wife at home raising your 3-4 kids.

Today when not on a gold standard that's no longer possible.

There's a reason that only gold and silver shall be legal tender in the constitution. Unfortunately our shit public schools don't teach about the founding ideas of this country or the constitution.

And that's why you have a shit society now.

If they’re in debt and have nothing to cash out, that means they have spent their loans. That means someone else has that money in hand. So no, he was correct.

AHAHAHAHAHAHAHHAA

fucking what

Yes exactly. If the money supply grows in tandem to population increase, that still allows for the deflation coming from technological improvements to drive prices down.

Yeah, but isn't my weekly salary (600-1000€) better than 100 years ago. I mean I can buy more things with that

Gold is money and currency. Of course we will never go back to exchanging gold and silver coins. But btc is in no way shape or form money. It can be a currency.

The problem with crypto people is they aren't understanding that the problem is rising prices and debt. That is it.

All the kiddies here make fun of 10% stock returns back in the day. Well 55 years ago when prices were cheap as fuck.... 10% returns were like 100% returns in crypto today given skyrocketing cost of living.

Just because we adopt crypto doesn't mean prices will go down. But backing with gold will make prices go down.

Deflation is good. It stimulates saving and rational consumption of goods.

The bashing of deflation is a keynesian meme and is as dumb as the broken window fallacy.

The amount of economic illiteracy on this board always astounds me. And the "gold standard" people on this board are always the least informed, treating inflation as the biggest evil imaginable.

Inflation basically makes climbing the wealth ladder in society harder by reducing the value of your earnings/savings by a small percentage every year.
In this context, it's easy for people who are already wealthy to stay wealthy and even become wealthier because they have lots of wealth to invest to protect against inflation.
However, for people who are not wealthy, there is no protection against inflation so it takes longer to save up.
In simpler terms, with no inflation it takes 10 years to save up 1,000,000 if you're saving 100,000 a year.
With inflation, 10 years of saving will still get you 1,000,000 but that amount at that 10 year point is only worth 750,000 compared to when you started saving.

There are 2 types of deflation, there is good and bad deflation. Keynesians conflate both types and label them as bad, you’re conflating both types and labeling them as good. Let me explain.
Good deflation comes from technological advancements and more efficient production chains. Bad deflation comes from a panicked population that just wants their money back from a bad investment and triggers massive deleveraging.

Most wages haven't been increasing at a rate that can combat inflation.

because the bank will never need to pay everyone at once, it's a "risk" that fractional reserve banks rely on to function

Casinos are a scam. If everyone won at once the casino would collapse.

Inflation discourages savings and encourages debt by diluting it.

Savings are required to avoid being dependent on banks and create healthier economic growth.

There's the belief that inflation encourages consumption but consumption per-se is not good, consumption is only good when it liberates people from having to do tasks that would decrease their productive output, IE, a mathematician spending 2 hours to cook while he could be crunching numbers while having a pizza delivered to his door.

Due to inflation, newly printed liquidity ends up in low-elasticity demand products, such as housing, education, electricity, healthcare, etc.

There's a false sense of boosted economy due to debt culture created indirectly by inflation and that increases the price of those high demand products, if you can't afford it, someone indebted to the teeth will, and people always sell to the highest bidder. Due to artificially low interest rates this debt lifestyle is even more encouraged, and due to democracy it's a problem we'll never get rid of, cause no government is ever going to stop the wheel of debt as that would take back the economy to a normal state and a lot of powerful people would lose money.

So your telling me that higher prices are better than lower prices?

The Jew govt
Controlled public schools have fucked this nation beyond repair. If our founders came back from the dead they would think you are from another galaxy

There's nothing bad from the second deflation. In the second deflation, the only bad thing was the investment, and the bad thing would be to share the problem with people who had nothing to do with it.

This is the first post that shows a legitimate criticism of inflation. Nonetheless, it's the people that want more shit and to increase there productivity, so mechanisms that encourage money circulation will always be the government mantra.

There isn't anything inherently wrong with this, when it goes out of hand then it tends to self correct sooner or later.

Not to mention that inflation erodes the value of debt, so isn't all bad both for people and for government. If you have a society based off debt you need to have inflation or you get fucked too hard by interest rates.

>There isn't anything inherently wrong with this

I disagree. As I explained this debt-acquired liquidity tends to end in sectors of the economy people deem as very necessary.

Say tomorrow everyone was given 1000$ per month, how many hours would it take to your landlord to raise your rent by 1000$?

In the end, this inflation is a price most economic sectors pay so other economic sectors can profit from it. You don't have money for your mower because you're using all your income to pay rent, thus you cannot mow faster and you cannot be more productive, stalling the economy.

Inflation is what's destroying the middle class.

It's not. Inflation facilitates circulation and investment

Inflation is irrelevant so long as it remains low and consistent, as for wildly fluctuating currencies like cryptocurrencies? That would effectively redistribute wealth from everybody holding currency to the party that is 'printing' the new money; as money is only worth anything relative to the amount that everybody else has. Because it takes time for the market to react to the change in the relative value of currency, those who printed it get to spend it before prices rise in response to the new money.

Crypto is hot fucking garbage.

Bad deflation is the definition of a recession so yes it’s bad. That’s not to say it’s not necessary at times.

1 btc now = 1 btc 100 years from now
1 US dollar in 1900 was worth $28.57 in 2016

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Should be obvious user, your money is only as good as the purchasing power it contains.

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>Shitty meme economic opinions
Inflation is good for the economy long term, because it encourages people with savings to invest instead of just sitting on it. Investment means more resources put into companies to create value, as well as more money in the hands of people who work at those companies, who then go on to buy things.

>But my fairness
Tough shit. The country's long term economic future is more important than the inconvenience of investing your savings.

>How many hours would it take to your landlord to raise your rent by 1000$
They wouldn't. Your mistake is believing that prices are determined by the value of money, rather than supply and demand.
>Does giving everyone 1000$ a month change demand
No, because demand for necessities is always about as high as it can possibly be.
>Does giving everyone 1000$ a month change supply
Initially no, because you already have the property. However, as inflation effects other products and services that will see increase demand due to the additional 1000$ per person spent a month, resulting in price inflation. Some of these products and services are used by landowners for their business (cleaning houses, upgrading property, building new property, management fees, employees, ect), which are going to go up in price, which means it's harder to supply housing, and rent goes up.

In the end, however, the increase in rent will not reach $1000. The question is, is the increase in inflation caused by the $1000 a piece going to result in lower actual value to the people receiving the money? With fixed currency, the answer is always no. With fiat currency, the answer can be yes if the fed adjust interest rates, and increases the sale of bonds in order to offset inflation.

The current economic situation has nothing to do with inflation, and everything to do with competition from third world countries, and automation.

its a waste of time trying to educate the poltarded idiots on here

this, but you need them, this is B&F after all, kek