Currently we can observe a general slowdown in the annual growth rate in price inflation across major countries around the world. [...] Most commentators are of the view that deflation generates expectations for a decline in prices. As a result, it is held, consumers are likely to postpone their buying of goods at present since they expect to buy these goods at lower prices in the future. This weakens the overall flow of spending and in turn weakens the economy. Hence, such commentators believe that policies that counter deflation will also counter the economic slump.
Inflation is not about general increases in prices as such, but about the increase in the money supply. [...] For instance, if the money supply increases by 5% and the quantity of goods increases by 10%, prices will fall by 5%. A fall in prices however, cannot conceal the fact that we have inflation of 5% here because of the increase in money supply. The reason why inflation is bad news is not of increases in prices as such, but because of the damage inflation inflicts to the wealth-formation process.
The economic effect of money that was created out of thin air is the same as that of counterfeit money — it impoverishes wealth generators. The money created out of thin air diverts real wealth towards the holders of new money. [...] So, countering a falling growth momentum of the CPI by means of loose monetary policy (i.e., by creating inflation) is bad news for the process of wealth generation and hence for the economy. [...] Furthermore, if a fall in the growth momentum of prices emerges on the back of the collapse of bubble activities in response to a softer monetary growth, then this should be seen as good news. The less non-productive bubble activities the better it is for the wealth generators and hence for the overall pool of real wealth.
https://mises.org/wire/central-banks-shouldnt-fight-deflation
(Score: 1) by khallow on Friday March 29 2019, @12:49PM
Which let us note is a valid complaint. "Math is hard" caused the development of a massive accounting industry for tax avoidance and similar schemes.
"Aren't supposed to" for what reason? What is the virtue here of forcing people out of savings accounts?
Ok, you just answered your "so what?" Because inflation is an excuse to tax rich people at lower rates. Glad you could help yourself answer that one.
I notice that point 1. runs counter to morality you've expressed elsewhere, such as [soylentnews.org]:
And "math is hard" is missing the consequences of throwing large amounts of dirt into the gears of society. Moving on:
The threshold is much lower than that. While it is rare, there are cases of people earning less than $75k being subject to the AMT due to the peculiar nature of their income sources (sounds like income that is extremely low tax by normal means).
Well, the future was what I was speaking of. I'll note that the above four years of delay happened after one of the "architects" bragged about the synergy of inflation and the Cadillac tax.