Inflation occurs when the money supply grows more rapidly than the value of the goods and services in the real economy, shifting the balance of economic/financial power from wealthy savers to less(generally people and corporations who were well-wealthyoff to start with) to borrowers--those who didn't have the money to pay cash up front to begin with--which in modern society includes the vast majority of young people (due to educational debt), aspiring homeowners, etc.
Controlled inflation (provided there is sufficient political power in the hands of workers and seniors on fixed incomes to demand cost of living increases) is usually healthy for an economy, because it disincentivizes hoarding, encouraging money to. Money that will be used for either consumptionworth less in the future is better off spent on stuff (demand thatfor which drives increased output) or for investmentinvested in productive capacity that generates a return (to meet that demand). Without inflationSince you can't just sit on your money and watch it be worth more, you have to put the best move formoney to work; and since loans will be paid back with cheaper future-money, the wealthyrisk of borrowing for a speculative enterprise is somewhat reduced. (Of course, lenders raise rates to use moneycompensate; there is no free lunch here. But on the whole, inflationary policy leads to acquire inelastic resourceslooser and cheaper lending.)
On the other hand, without inflation, savers have no incentive to invest in increased productive capacity--lower inflation means less demand means less market for the goods produced, anyway! If your money will be worth more in the future just from sitting on it, you either sit on it, or invest in very stable investments with predictable returns (likesuch as prime land) ownership, which is unlikely to lose value, and then extract rent fromwhich is especially attractive if there are fixed rents, since a deflationary environment means the usemonthly take will just be worth more and more). Deflationary environments also tend to lead to the concentration of themexisting productive resources (such as, which creates a permanent drag onagain, prime land) in the consumptionhands of everyone elsethe wealthiest parts of society, since more marginal owners of productive resources are often forced by their increasing debt service obligations to sell at unfavorable terms.
