Timeline for Why don't countries like Japan just print more money?
Current License: CC BY-SA 4.0
13 events
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| Jun 17, 2020 at 9:20 | history | edited | CommunityBot |
Commonmark migration
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| Jun 24, 2019 at 18:32 | history | edited | Tiercelet | CC BY-SA 4.0 |
Clarified that the inflation figures refer to net borrowers and savers, not simply people who take a loan or have some investments.
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| Jun 20, 2019 at 6:35 | comment | added | Luaan | @Tiercelet As for countries having to print money to enable people to save... it's telling that they're returning to terms like "trade deficits", and that they care about "the sum of the saved money in private hands", much less equating it to government debt. Ouch. | |
| Jun 20, 2019 at 6:34 | comment | added | Luaan | @Tiercelet It's not controversial, but it also isn't true. For one, most people are both debtors and creditors (just like most workers are also (small scale) capitalists). For two, saving (and investment, insurance etc.) is more important for poor people than for rich people. You need those savings to deal with unplanned expenses/lack of income. Now, it's certainly true that this tendency has somewhat decayed (in part due to social safety nets, which both make it more expensive to save and less necessary), but it has existed for quite a long time and still exists today. | |
| Jun 19, 2019 at 22:42 | comment | added | Tiercelet | A hair OT, but you've hit the crux of MMT's importance by observing that people generally want to save. This is not possible (in the aggregate) without governmental money creation (this is basic sectoral balance). The sum of the saved money in private hands, and accumulated trade deficits, is equal to the government debt. In order for people to save, the government must deficit-spend. See en.wikipedia.org/wiki/Sectoral_balances or neweconomicperspectives.org/2011/06/… or images.app.goo.gl/JLjJDLrLz5B45bL7A (pics) | |
| Jun 19, 2019 at 22:26 | comment | added | Tiercelet | @Luaan I do not assume poor people are debtors, but that debtors are usually poor, and creditors rich--private parties cannot lend what they don't have; is this really controversial?\\Inflation may discourage investment some, but not enough for people to stop doing it; it simply encourages investment that yields a return, vs hoarding money unproductively and waiting for it to be worth more. With the choice of having $1mil in the bank (or the stock market!) and having to service a $1mil loan, I'd absolutely take the former, to heck with inflation--it's better to have money than owe it. | |
| Jun 19, 2019 at 8:05 | comment | added | Luaan | @lazarusL Even worse; the argument assumes that poor people are always debtors and rich people are always creditors. The problem is, one of the main ways you can provide security to yourself (and your family) is by savings and investment - which is exactly what inflation discourages you from. So not only are you poorer every year while your real wages and savings deteriorate, you're also prevented from accumulating wealth and encouraged to live in debt. All the while the numbers go up, so many people don't even realize there's a problem as they get even poorer. | |
| Jun 18, 2019 at 21:40 | comment | added | Tiercelet | @lazarusL thanks, good questions. I've edited to clarify and respond to your points. | |
| Jun 18, 2019 at 21:37 | history | edited | Tiercelet | CC BY-SA 4.0 |
Clarification of the impacts of inflation in response to comments from LazarusL.
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| Jun 18, 2019 at 12:36 | comment | added | lazarusL | "Without inflation, the best move for the wealthy is to use money to acquire inelastic resources (like land), and then extract rent from the use of them, which creates a permanent drag on the consumption of everyone else." Why is that the case? Land is a great asset in an inflationary environment as it increases in value with inflation. | |
| Jun 18, 2019 at 12:33 | comment | added | lazarusL | "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-wealthy borrowers." Inflation doesn't have such a clear rich/poor divide. It also helps keep wages low as employees have to negotiate for cost of living increases just to stay even, this hurts the working poor and middle class the most. | |
| Jun 17, 2019 at 23:00 | review | First posts | |||
| Jun 17, 2019 at 23:12 | |||||
| Jun 17, 2019 at 22:57 | history | answered | Tiercelet | CC BY-SA 4.0 |