GOOD inflation vs BAD inflation

First of all, what I mean: To me, "bad" inflation is when prices are so high, people can't afford to buy things. "Good" inflation is when prices are high because people can afford to buy things.

Why is it "good"? Because the economy is active. People buy more because they can afford to buy more.

What we are seeing now is so many people who can afford to pay high prices, that there is no incentive to lower them. At the same time, offers of high paying jobs abound in most states. So people pay more for goods and services BUT that's because they have money in their pockets to pay for them.

I think we have been living in a "veiled" deflation for decades. It has be so stagnant that we just... got used to it. People in the lower and some in the middle class got used to struggling. They got used to having to work two or three jobs. They got used to not affording basic things like adequate housing, clothing, food...

People are just not used yet to this. They are not used to actually AFFORDING things.

The breaks in the supply chain that will be affecting this holidays season are due, for the most part, to the fact that people purchase power is reaching record highs.

So yes, people are paying more for things than they did a year ago. And this facts scares many of them. But slowly they are realizing that they can also AFFORD more things than they did a year ago. And more of them can afford them without having to work more than one job.

The result is that businesses have no reason to reduce prices, but they do have many reasons to raise wages, if they expect to fend off the competition. And this is great!

This is how capitalism is SUPPOSED to work in a Darwinian universe. Everybody wins... except businesses that can only survive by exploiting workers and not pay them a proper living wage

**BTW, by "living wage" I mean what it's defined by the general consensus (https://www.investopedia.com/terms/l/living_wage.asp). But this thread is not about discussing whether or not the general consensus is right or wrong. So please spare us your strawman arguments.

 

There is no such thing as "good" inflation. It means you have lost purchasing power. It is the same as a pay cut. It especially hurts people on fixed income and those who are depending on accumulated savings for retirement. This recent good inflation knocked out over 5 to 10% of my hard earned savings for retirement. That is savings lost which will never come back.

 

There is no such thing as "good inflation". Inflation is a bad thing. It means that the money supply is being increased without a corresponding increase in wealth.

See above.

Not at all. What we are seeing right now is government induced shortages (as a result of very strict and unnecessary regulations). What we are seeing is a government acting with intent to destroy the former USA so that they can subsequently 6uild 6ack 6etter from it.

The working class (and people living on fixed income) are currently getting absolutely destroyed by the Brandon Regime's policies, and that is the purposeful intent of the Brandon Regime.

No, they don't. They are currently adjusting their purchasing habits to the bare necessities of food/water/energy/gasoline because prices are increasing MUCH faster than their wages are.

BS.... People were prospering under Trump, since inflation rates were MUCH MUCH LOWER than wage increase rates during the Trump Admin... The working class was thriving and getting ahead. They were spending money on luxuries.

Now, under the Brandon Regime, they are suffering tremendously. They have had to remove luxury spending and revert back to "survival mode" spending (purchasing only basic necessities). Inflation is destroying the working class (by purposeful intent of the Satanic Brandon Regime).

People are not purchasing items so fast that the supply chain can't keep up... There is not a lack of available items. Rather, items are sitting on cargo bays in California because California won't allow any semi tractors that don't meet extremely strict emissions regulations to enter into and haul items out of those ports.

Effectively, California has reduced the number of available semi tractors to near nothing, thus creating shortages and supply chain issues. It is entirely self imposed, and by design, to destroy the former USA.

People WERE able to afford things under Trump, since their wages were increasing much much faster than inflation was. Nowadays, however, people are losing their ability to afford things (as inflation is rising MUCH MUCH faster than wages).

Businesses, especially small businesses (of which the Brandon Regime also has purposeful intent to destroy) HAVE to increase prices of their products since they have ever increasing costs of bringing their goods to market. Raising wages for them is an expense, which also goes into the final cost of the products that they bring to market. --- Eventually, under Brandon Regime policies, it will only be multinational corporations such as Wal-Mart and Amazon that are able to exist.

No, this is NOT capitalism AT ALL... This is fascism and communism. Fascism and communism DO NOT WORK.

Marxist-speak. Meh.

 

I'm guessing after reading your detailed debunking of the OP's ridiculous post, that the OP author is quite embarrassed as to posting that garbage in the first place. Good job gfm, and spot on!

 

There is an increase in wealth. In fact, one of the main reasons the supply chain is broken is that there is so much demand.
https://www.businessinsider.com/america-isnt-running-out-of-everything-supply-chain-2021-10

Consumption is expected to hit record highs during the holidays. So people are paying more because they are making more money. More people who were under the poverty line can now AFFORD to buy things they couldn't buy before.

Facts and reality are not on your side.

 

The inflation we're seeing is a trade-off for the Fed not acting too early and stifling the recovery by raising rates. Quite a bit is being caused by supply chain constraints that will subside. The larger concern will be the sticky nature of wage inflation as a result of the great resignation phenomenon. There is a tectonic shift going on in the labor market that will have lasting effects. Effects the Fed can tamp down at any time by being more aggressive with rate increases. As of now the bond market is more concerned with stagflation than inflation as evidenced by low yields.

 

Inflation does not increase wealth. It decreases wealth. To claim this break down in the supply chain is due to increased wealth is absurd. We have not eaten any more or used any more wash powder or other neccessities, but now they are in short supply.

The only reason I can think of that you would write this ridiculous piece is to somehow justify the enormity of Biden's mistakes by somehow trying to claim that a little inflation is good inflation.

As far as people now affording more, take a look at the labor participation rate. It is down about 1.7% from pre-pandemic levels. That amounts to over three million people who are neither working or bothering to look for work. Explain where they are getting all this income to spend more.

 

Liberals such as yourself sure do love to ignore key words...

"... no corresponding increase in wealth."

Demand is not outpacing supply. Part of the problem is that supply is sitting in oceans outside of ports (or stacked up at the ports themselves) because of California's strict emissions regulations on semi tractors (effectively regulating most of them out of existence). Another part of the problem is that a shortage of available employees is being purposefully created due to unconstitutional and Nuremberg-Code-violating mRNA jab mandates. Again, demand is NOT outpacing supply.

I cannot view your link because it is pay-walled (and I don't have an account).

I eagerly await the subsequent announcement of an "unexpected drop" in holiday consumption. Everything of this sort is supposedly "unexpected" to these people even though they are purposefully intending for such results to occur...

No, they aren't. Their real wages (wages after factoring in inflation) are rapidly decreasing. IOW, as I said a number of times in my prior comment, their wage increases are NOT keeping up with the inflation increases that they are seeing at the grocery store, gas station, natural gas provider, etc.

This was true under the Trump Administration, when wages were increasing MUCH faster than inflation was increasing. This is NOT true under the Brandon Regime, where inflation is now increasing much faster than wages are. More people are now entering into poverty. I've seen this first hand with the "tent city" that popped up in Madison, WI a few months ago for the first time that I have ever seen during my lifetime.

You don't know what the words "fact" or "reality" even mean... you are just using them as meaningless buzzwords. I can clearly and unambiguously define both of them for you if you'd like, but I'll give you first dibs at doing so... Here's your chance to "teach" me....

 

And when they can do so because the government is printing money and passing it out that is "bad" inflation.

 

GOOD inflation vs BAD inflation

Something that only a person who doesn't understand inflation would say. Inflation is good for debtors because it allows debts to be repaid with less valuable currency. For everything else and, in general, inflation is bad. Government fears deflation because it would make the national debt and the interest it accrues harder to pay. So they attempt to keep inflation at a 2% level which they view as an acceptable level. The result has been a serious loss in the value of the dollar over time - over 90% over the last 60 years or so. Because inflation is good for the government, doesn't mean it is good for you or me. It is not.

I should mention that the rise in prices this year is due to two main reasons. The first is inflation caused by government expanding the money supply. There was nothing in the budget to pay people not to work this year so the payments were all inflationary. The other is supply and demand. We have very serious product shortages due mostly to government meddling in the economy last year. But demand is quite healthy currently for the same reason. Prices rise when demand exceeds supply.

 

So goes your dogma, but not reality. People are buying more. Therefore they HAVE more.

Wonderful! People HAVE more and have to work LESS to obtain it. The American Dream is back!

Simplicity in stating facts and reality ALWAYS stumps the extreme right.

Bottom line: if, despite the fact that the price of stuff is higher, people can AFFORD to pay those higher prices to the point that it creates a backlog in ports... that means THAT inflation is good.

 

Corresponding to what? There is an increase in wealth. People can now AFFORD to pay higher prices, and they get MORE in the process.

Period!

Yes. That's PART of the problem. The other part is that people have more money to buy MORE. And this creates a backlog. But also the fact that those who disembark the ships don't NEED to work for less than a fair living wage anymore is part of the backlog.

The rest of your post is just unrelated B.S.

 

When government prints money that trickles up (instead of the voodoo economics of "trickle down"), that's good for EVERYBODY. And today the right is desperate because this is being proven by reality.

 

A dollar which used to buy one dollar worth of goods is worth more than a dollar which now buys about .94c worth of goods no matter how you spin it.l

They now have to work the same amount to buy $1.07 which is now worth what $1.00 used to buy.

Let me know when you state a fact so that we can confirm that.

 

Nope because the value of your other dollars decreases and people don't have to work so jobs and productivity suffer.

And it is called Supply Side and works every time, do you even know what is Supply Side?

 

What is the value of our currency based on?

 

If there were only 94 cents worth of goods, there wouldn't be a backlog in the nation's ports.

Not only are people willing and able to pay $1.07.... they are willing to buy MORE now than they bought when they only had to pay $1. Whether that's keynisian economics or something else... the fact is that, right now, it's working. And people (especially lower class and lower middle class) are benefitting from it.

So.... who knows... maybe you just proved Keynes was right!

 

Any argument that inflation is good is absurd. There is only one reason why people are able to buy more they. They were shut in during the pandemic and saved money and now they want to replace items which are worn out and get out and do something after being shut in for nearly two years. .

I have no idea what that is supposed to mean unless you are saying that only 94c worth of goods are tied up in the ports which makes no sense, even for you.

 

I already told you. Go back to my initial response to you and this time please read what I typed out.

Not a corresponding one.

Repeated chanting... I have already addressed this. Chanting is not an argument.

Repeated chanting that has already been addressed. Chanting is not an argument.

You are now in paradox:

[1] Supply is present and sitting in oceans outside of ports.
[2] Supply is not present and is backlogged due to increased demand.

Which is it?

Marxist-speak. Any shortage of employees would be due to mRNA jab mandates and/or governments paying people more to sit on their ass than to work. Any future mention of "backlog" is summarily dismissed as irrationality until you clear your paradox.

IOW, you are unable to refute what I said and are waving the white surrender flag. Got it.

 

Printing money (adding to the money supply) without a corresponding increase in wealth causes inflation, dude. NOT GOOD.

 

Do you not read the news, or information regarding actual facts at all? Has your radio, TV and internet been throttled?

Total Household Debt Climbs in Q2 2021, New Extensions of Credit Hit Series Highs - FEDERAL RESERVE BANK of NEW YORK (newyorkfed.org)

People are spending money they don't have. I'll leave it to you to figure out and then twist the reasons why, because I am not going to do the rest of your homework for you.

 

Yeah... because people didn't have to EAT during the pandemic.

What an unending source of unsubstantiated nonsense the Lord has endowed your lower back with.....

 

Thanks. But if it's not important enough for you to repeat it, it's probably not important enough for me to look it up.

 

Exactly! That's why this one is a GOOD inflation.

 

You are really dense. In case you had not noticed, people did not go out as often to eat. They did not travel as much. Businesses closed because of lack of customers. Movie theaters shut down, etc, etc.

That is BS. Money is a reflection of the goods and services required to earn it. When it is handed out by the government, there are no such goods and services. It adds to the money supply without a corresponding increase in goods and services.

Good grief. Where did you learn economics? Where ever it was, they need to close that school.