Thanks patientrenter for your reply. I particularly liked points 1 and 2 that you made. You make it sound like inflation is intentional coercion to force participation in the stock market mania by either investing or spending on companies (which then fuels the market). I still don’t know why saving cash is considered such an evil. I can’t get over the notion that money should be ultimately linked to intrinsic value and production. Is it only evil if consumers save the money but good when it ultimately piles up in some rich guy’s account where he can convert it to real assets?
So inflation is intentionally made in order to force participation in the stock market scheme. “Buy now or you’ll never be able to retire.” or “If you aren’t willing to participate then you will lose all your savings’ purchasing power.” Sure seems strange that the stock market can increase in value consistently much faster than real economic growth. My common man theory of finance thinks a major adjustment is inevitable.
I wonder how long we can keep putting off worrying about the national debt though. That is a little more than an 800 pound gorilla in our economy I suspect. It also seems like that eventual “crisis” will doom the consumer if nothing else will. That probably sounds quaint because doomsayers have been worried about this for a few decades now but the system still hasn’t imploded. Seems like there is a lot more reason to worry now than ever.
The only way for government to pay debt is through raising taxes or to inflate it away. I have heard estimates that taxes would have to at least double to start meeting our obligations. That would sure take the wind out of my consumer confidence. Either solution seems like dark times are ahead. Inflating debt away can’t ever be the ultimate solution. That would be like getting away with your toxic house mortgage because appreciation will bail you out. It doesn’t make sense to never have to worry about the size of your mortgage/HELOC debt because your house can rapidly increase forever in value. It also doesn’t make sense to never worry how many trillions we owe as a nation because inflation will always bail us out. There has to be a practical limit to inflation. Eventually everyone will see our money as the worthless paper it is.
What happens when the government decides to just “mail the keys in”?