This isn't the gotcha that you think it is. Inflation is kept at a positive number on purpose. Deflation causes a self-reinforcing spiral that brings everyone's wealth down. If inflation is too high that's a problem too, but it's less of a problem than deflation.
... With that said, the huge amount that prices have gone up recently is caused by corporate profiteering, which is a serious issue that needs to be addressed.
Because it's efficient at transferring wealth upwards.
Normally a strong democracy with multiple parties, checks and balances would help stop this. But the new META in economics is to just buy politicians to do your bidding for you. Kinda hoping the Supreme Court will patch that at some point, but it's not looking likely.
It is efficient, in increasing the wealth of the wealthy.
I realize this isn't really the place for this discussion but capitalism doesn't know what the word "efficient" means. Is it efficient to have to buy the same thing twice? Is it efficient to only make cheap shitty and yet still overpriced versions of everything for the consuming public, shit that is designed to fail? Is pollution efficient? Is ruining everyone's lives efficient? Pointless jobs? Rich people? These things are efficient the way fucking for virginity is efficient. The way Elon's Twitter has been efficient. The way shitting the bed is efficient. Which is to say, it's really fucking not.
The system is working as intended.
The rich get richer
.... The system is working as intended.
It's efficient at exploitation
Companies that are structured to maximize short term shareholder value need to make extra profits at all costs.
Supply lines were strained during the pandemic, which led to drastic price increases. Supply lines stabilized and the pandemic subsidized. Prices didn’t go down? Why?
Because the companies that set prices need to make more money this quarter to make the shareholders happy. And they bribe the politicians and the judges and the regulators to control the system at every level.
These rich assholes doomed our world to destruction and our “leaders” were too greedy and small minded to stop them.
Enjoy the ride down
Guys I love you and support most of the changes you want to make regarding the way we govern ourselves.
But sometimes I see some posts that make me wonder. I want to help solve capitalism and it's problems. So I'm studying macroeconomics I'm studying economic theories in general.
Sorry,and with all due respect, sometimes there are some dumbass posts that show a complete lack of understanding of how things work in the world economy.
It's very efficient at extracting wealth from the lower classes.
That's literally the stupidest nonsensical shit I've ever seen, doesn't even make sense.
Greed.
that's what it's efficient at!
Aliens.
Because money printer go BRRRRRR
They go up in communist countries too but with the added benefit of shortages and rationing to keep prices relatively in check.
And small inflation is not bad. As long as it is stable and predictable, it does not matter much since people know roughly what price to expect. Theoretically it should be the same for deflation but workers tend to not also accept lower wages when prices drop. It also leads to banks not lending out so you can really only start a business or buy something big if you already have the money. While that is easy enough for people who are rich, it limits social mobility of those who would have to borrow to do the same since finding a lender is more difficult.
Because unregulated capitalism gets wiley the more rope you let out.
Because regulations
The idiot right
Permanently Deleted
Because the market isn’t free and capitalism has broken down. Competition, a key part of free market operations, was massively reduced when the governments of the world forcibly shut down millions of businesses a couple years ago.
It's built in. Have you not been paying attention?
Isn't inflation good for consumers? Deflation means what you already have becomes more valuable -- so the rich would gain a significant boost to their finances since they already have so much. Inflation though would mean they lose a significant amount, and it becomes easier for the working class to break into the rich people bubble.
Prices go up because wages go up, and wages go up because prices go up. Which seems like it can't possibly be the explanation, and while it is of course a simplification, it really is surprisingly accurate.
Inflation is mostly there so that people can keep getting raises and doing better than they did yesterday, without actually moving forward. It's kind of like the Shepard tone. Always infinitely seeming to rise in pitch, but never actually doing so. Or if you are unfamiliar with that reference, it's like a stairmaster. Those stair based exercise machines. You constantly go up a set of stairs that is constantly moving down at the same speed.
Each step feels meaningful, but by the time you are ready to take your next step, you are relatively exactly where you were before. You constantly have more and more money over the course of your life, and to a small degree by the end of a long career you should actually be a little bit ahead if everything went well for you, just in time for you to retire and remove your higher than average salary from the pool to offset someone else gaining a raise that is slightly ahead of inflation.
This is of course all a gross oversimplification. But it's the "slightly accurate model" first step, that leads to learning all the rest in actual depth that changes some of the specifics by a tiny bit if you look closely enough.
