Inflation is never "healthy." Claiming a small amount of inflation is beneficial reveals a misunderstanding of its effects. Without inflation, people would buy more as prices drop, and entrepreneurs would be motivated to create high-quality products now to maximize profits.However, inflation dilutes savings, making goods unaffordable and allowing large institutions to profit by delaying innovation.
It ultimately fosters poverty, planned obsolescence, and hopelessness. Don’t be misled by central bankers; they aim to erode our savings. investingSaying "inflation is good" only falls into their trap.
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That's interesting, @sharina_mc1 !
I've never saw a central banker that favored inflation.
Could you please be kind as to point some country that has central bankers that thinks this way ?
@hgfernan Policies like targeting a low inflation rate can create an environment where inflation is tolerated. Countries like the U.S. and the Eurozone have frameworks that often prioritize price stability, but the consequences can lead to inflationary pressures that affect savings and purchasing power. It's a complex balance.
Dear @sharina_mc1, as you said it's a complex balance.
But maybe it's an overstatement to say that central bankers do think that "inflation is good".
Maybe in the distant past, when there were Keynesians among central bankers. Currently most of them are neoliberals at heart.
@hgfernan You're right, Mr Fernandes! The views on inflation among central bankers have evolved. Historically, some Keynesian economists did advocate for a moderate level of inflation to stimulate demand. For instance, during the 1970s, many central banks adopted policies that tolerated inflation to combat unemployment. Today, however, the predominant focus is on price stability, especially post 2008 financial crisis, with central banks like the Fed and ECB aiming for an inflation target.
@hgfernan This reflects a shift toward neoliberal policies, yet the balance remains delicate, as seen in the recent debates around inflation targeting versus quantitative easing.