Topic: Higher Inflation Is Here to Stay for Years - page 4. (Read 678 times)

More people say store of value now than ever before, but my point about that would be the same.  An asset needs to have a reliably predictable and steady value to be a store of value.  Bitcoin I wouldn't say fits due to its extreme volatility.

I do, and you don't. My title is a citation.

Wot? Haven't they recently told us that the inflation was transitory? Maybe what they really meant was it is transitory from low inflation to hyperinflation  What I really know is that you can't trust a damn word coming from a FED chairman's mouth. They are all muppets. How can you expect transitory inflation when you printed 2/3 of the total USD reserves in one year? 

BTC does have the function of storing value, even other functions such as speculation and transactions.  That is the basis of BTC being considered a currency, but what continues to be a problem today is the uniqueness of this currency which lies in a decentralized system and makes economists bothered especially those who are very pro-banking concepts.  If all countries support BTC then their fiat will not sell in society, and people's current wealth will be converted to BTC, won't that disturb many people who are already in their comfort zone.

Federal interest rates are going to stay low for years in the US, but I'm convinced that there is no coming back from this. You can't have the world's largest economy uncontrollably print trillions of dollars and short out the labor market with unemployment checks without any repercussions. Paper money supply is too big right now. US is something at like a 5.4 percent inflation rate according to the CPI -- target is about 2 percent yearly (a 2 percent interest rate is healthy, incentivizes spending so people are not holding onto currency, federal banking institutions consider 2 percent to be good for the economy), so on the road to tripling the target range.

yes that's right, I have read several articles about long term inflation due to the pandemic not true. inflation may only be a few years after the pandemic is over inflation will decline. I think this is normal because the market is not developing well and global economic conditions are also affected

You don't know what you're talking about in your title OP, it's going to eventually subside, it's just that at this point we just can't see it so we think that there's no end to it. There's a lot of hyperinflation throughout history and all of them seem to subside in time and the country that was affected did recovered from the damage.

There is something much worse than inflation per se, and that is war - so I can say that I have personally felt both evils on my skin, and if you ever wonder if it is harder to be hungry or to be in constant fear of death coming from the sky, you're actually just wondering what will kill you first. Such experiences help me a lot today to look at the current situation from a completely different perspective, because everything that is happening is so harmless given what I have experienced in the past.


I can only say that Europeans are largely responsible for the fate of these people, although some will say that it was a long time ago - but the consequences of Spanish and Portuguese colonization have left an indelible mark. Resource-rich countries like Venezuela should prosper in every way, and that's not the only case when we talk about Central or South America - aside from the corrupt politicians everywhere, it's hard for me to understand that nothing has changed for the better there for centuries.

As for emigrants who send money home, I can only say that some nations in the EU are also recording record inflows of money into domestic banks - even to the extent that they are trying to come up with some extra tax on all that money.


Of course, people always go for better jobs and opportunities, but small countries pay a big tribute to mass emigration, which is most manifested in the demographic collapse and survival of the pension system in the future.

I see 2 causes for the rise of inflation.

The obvious first cause is government' spending. Central banks have been printing money like there's no tomorrow, and this just can't go on forever.

But a second problem is with many shortages. I'm always watching closely the automotive industry, and it's facing hard times because of a shortage of chips. Nobody had seen that coming, but the result is that car prices are on the rise. There's also a home shortage because of scarce supplies in several countries, so houses prices are also on the rise, and much more than 3% per year. I've also noted this article a few days ago:

https://fortune.com/2021/07/08/steel-prices-2021-going-up-bubble/

Steel prices have more than doubled in a single year. Copper price is also red hot because of the surging demand for electric cars. I don't know when this will end, I guess nobody knows, but those are many signs that inflation will only get stronger.

The inflation, it won't be gone and it's going to happen for each country unless that country will perform very well and won't have that increase in inflation.

It's the cycle, the inflation will increase but to decrease it will be hard or at least won't happen.

While there's inflation, as long as you hold bitcoin, it's one of the ways to beat it.

yes I agree with you, but in my opinion bitcoin is a store of value. Store of value itself is something that does not depreciate over time. Usually this medium store of value is rare and cannot be easily devalued. This is what causes Bitcoin to be categorized as a store of value. The best thing you can do with bitcoins is store them so you can protect yourself from inflation. Even though bitcoin is volatile, if it is withdrawn over a longer period of time (logarithmic chart), the value of bitcoin has remained or even increased drastically in the last 10 years.

Inflation of 3% over the next several years compared with the extreme volatility of bitcoin isn't even a question.  The dollar wins hands down.  Your bitcoin could be worth $40,000 next month or $20,000.  That's not protection from inflation.  To actually protect against inflation, you need something that holds a steady and predictable value.  Not that I think people shouldn't own bitcoin, but they definitely need to not delude themselves into thinking they're protecting themselves from what is ultimately still a low inflation rate by doing so.

Totally agree!
The price of Bitcoin a year ago was at $ 9,203.37 and the consumption of my basic basket has remained the same when compared to the price of bitcoin today $ 31,816.34. At least bitcoin was able to save me from inflation and allow me to buy the same groceries. I think that most of us need several sources of income in order to save a little money for the future.
Every day we can see that we need cryptocurrencies as alternatives to FiAT in order to sustain inflation.
I live in Venezuela and my testimony is the contrast of a person who supports a family of four and who eventually has to support two older adults with food. It is a tough battle but the power of God is great.

The effect would differ depending on the countries that got affected by it. The most common effect of inflation would be unemployment and in this case, a 3.2% inflation rate for a higher income country would be a child play but for a lower income country the effect would be huge. Aside from that, there could be other numerous effect that may affect the country as well.


All other currencies has been suffering from the pandemic effect as well though. The whole world needs to go back to normal or else the economy would be declining

Living in Nigeria, I can ascertain that the situation is quite bad and has been for a number of years. The naira has been losing value long before the pandemic and with a widening gap between the elite and lower class, there has been a drop is SMEs and lack of opportunities for businesses leading to higher inflation.

Corruption plays a major factor in this as fiscal policies to rescue the economy are non existent and while some Nations would recover from the effects of the pandemic, some others would not and may experience hyper inflation for a much longer time.

When you read something like this is in a mainstream media website then you know this has already been happening for some time and they are just catching up with the reality of the situation, I think the real question is if the inflation is going to get out of control during the short term? And while I do not think this is going to be the case, the economy is frail, if another black swan came and hit us I doubt the economy is going to have enough strength to resist it.

whether the inflation that will occur or that has occurred in various countries is deliberately designed to restore the economic system from zero and try to restore something that is gradually being updated.

During the pandemic, everyone was aware that big inflation was waiting, but besides that, reformers of the economic system began to be heralded and changed the conventional order to a newer system.

Prices of things would have been worst where I live, if not for people going against unreasonable lockdown to do their businesses and help keep prices of local products from going through the roof. If not for the regular business people here, prices of things would have gone above 30-50%. I was actually surprised that bag of stable food like local rice remained pretty thesame. The hardworking small and medium scale business men/women pretty much saved the situation. Thanks be to the CREATOR for doing it all.

This is a good suggestion to bring inflation down to 1% or 2% but this has not been possible to different government. In Africa for example, the inflation is over on 2 digit for the last 5years. In Nigeria, the government is talking tough on cutting inflation down as price of goods keep rising, the challenge for inflation is corruption. Paying leap service to policies contribute to lead to bad pricing.

You're just like me from this side of Europe and even without thinking twice I'm 100% sure you've had at least 2 years of inflation over 100%, so what we should know indeed is that 3% or even 10% is nothing compared to what some have experienced but at the same time that even if this inflation doubles it doesn't mean the end of the world and suddenly everybody will dump the fiat currency and embrace some other kind of monetary policy.


Maybe or maybe not.
Venezuela and even Salvador are still clinging just above full caveman style poverty because there is still a lot of cash flow from other countries like remittance and a bit of tourism, if the US goes dark that last lifeline is also cut, what will happen then?
Besides, Mexico and Brazil didn't go through a ww1 and ww2 with two atomic bombs on top of that, yet...
https://www.nationmaster.com/country-info/stats/Economy/GDP-per-capita-in-1950
Some have gone through worse times and ended up far better than others.

Anyhow, we all knew inflation was coming, even without the money printing it was clear it would happen simply because of the lack of goods, taking lumber, for example, that spike of 400% didn't happen because of money printing, it happened because of the whole manufacturing and logistic chain was almost destroyed. Inflation is here to stay, especially if we're going to experience the 4th wave with lockdowns but it's nowhere near the point of making a country collapse.