Topic: INFLATION IN THE UNDERDEVELOPED COUNTRIES - page 6. (Read 3712 times)
It's not right to blame the poor or underdeveloped countries if they have an high inflation issue, this is because inflation problem can be anywhere and anytime. Inflation is the rate at which the general level of prices for goods and services rises and results in a decrease in purchasing power of a country's currency therefore becoming a poor country is not the only reason of inflation but because either excess aggregate demand (economic growth too fast) or cost push factors in which rich countries could happen too.
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
What sort of BS are you blabbering here? World has failed the minority? Who is the minority? More than 80% of the world population lives in developing nations and are you going to say that they are a minority? I am also living in a developing nation, but I have never blamed any foreign nation for the issues here. The problems that we face are our own making. There is no point in blaming the others.
And now coming to the part regarding raw materials. If the developing nations have the technology to process these raw materials, then what is preventing them from doing that? But they are unable to do that because of corruption in the government and ethnic infighting. Check the case of Nigeria as an example. Despite huge petroleum reserves, the vast majority of the population is living in poverty.
I think the underdeveloped countries will have difficulties if they do not sell their natural resources to developed countries. they will experience a crisis because the country does not get income. Most inflation occurs because the economy and the level of sales in the country are not stable. and inflation usually occurs because the central bank prints too much money. to avoid inflation they must export more than imports.
Quote
Our minimum wage, in theory, should be adjusted annually to keep up with inflation
Minimum wage is an artificial way to force pricing for Labor. Its not really a correct way for a capitalist economy to operate with prices set by government, it can cause dangerous imbalance in supply and demand.You are right. I am residing in India, although we have a minimum wage set by the government, it is rarely enforced. Most of the unskilled workers are employed in the informal sector, and in most cases they are paid well below the minimum wages. You can't blame the employers as well. If they raise their wages, then their businesses will not be able to compete against other brands and they will be forced to close down. In the end, it will do more harm than good to the employees. Concepts such as minimum wage are associated with socialism. And we all know that socialism is a failed ideology. History has proven that capitalism is much better than socialism and we should be better if we don't mix socialist concepts in a capitalist economy.
banks think that they can do whatever they want with money that is not even theirs but fortunately for us we have an option that we did not have before in the form of bitcoin and no one can tell you what to do with it no matter what they do.
I'm truly glad for Bitcoin to be an option we can tap into, but we have to look at how it is impossible for people to have all their funds in Bitcoin so that we have total control over what we own. Volatility is a major concern right now and will be that in the forthcoming years as well. I wouldn't even put all my money in Bitcoin if it has Gold's 'stability'.
What we need is a decentralized unit of account that maintains its value no matter what. I like the DAI stablecoin because it aims to solve that problem. The only thing we can't solve is scalability, therefore have to accept that Bitcoin and other cryptos will likely never reach a state of total mass adoption. Perhaps that we can have some sort of a workaround through interoperability between various networks, but we haven't seen it be put to the test yet.
People have different expectations for bitcoin and I do not really need that bitcoin is adopted by most people around the world, as long as I could use bitcoin for several of my regular activities I will be happy.
Quote
Our minimum wage, in theory, should be adjusted annually to keep up with inflation
Minimum wage is an artificial way to force pricing for Labor. Its not really a correct way for a capitalist economy to operate with prices set by government, it can cause dangerous imbalance in supply and demand. Its a related problem that government is forcing interest rates to stay low so that they can set debt repayments low or they might be insolvent or bankrupt even, similar to Greece which had no control to fix rates in this way.
The QE programs are also faking demand which is not there for the debt. All these measures represent weakness in the economy, inflation causes instability and irregular value and disruption to prices because value is no longer there as it should be. The min wage does not fix inflation unfortunately, workers feel the failings in currency from the costs it causes to them where as large business likes the low cost of debt and can alter prices as they dominate various markets.
Inflation is inevitable in developing countries, even in underdeveloped since some fields are use to develop high rise buildings or sometimes they're resources is being transfer in other countries. There time that the demand for a specific crops or energy is not enough for their people that cause inflation to arise. What is really needed are public officials that not only use the government money for their sake but also to lessen and to moderate the inflation rate causes by losing their economic resources. And as an individual strive hard to find a better ways of earning or extra job or find skill like trading that can help you live while inflation is getting high.
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
Nothing will change. The rich get richer, the poor get poorer. It is all these inflation and crises that generated Bitcoin and other cryptocurrencies. As one famous person said, “Fiat money is the money of governments, and cryptocurrencies are the money of people.”
The problem with poor economies is that they no longer own their resources, their resources belong to corporations through controlled governments.
Let's not blame the inflation for seeing the worse situation of the people who live in a certain country. I watched a few documentaries online and I saw that they are from the slum and they are so poor but with the right dedication he succeeded in life and he now help those people who are also in slum to become successful. The lesson here is, it is all on you, don't rely to others but rely only to yourself and do your best to get out from being under the poverty
Exceptions typically prove the rule
And the rule here seems to be as follows. If you are an average guy with pretty average abilities who has been born into poverty in a third world country, no matter what you do (or dream of), you will basically end up where you started from (unless luck massively interferes). To be an exception, you need to be well above the average and you would still need a bit of luck to break out of the so-called poverty trap. Besides, it is through others and their help that such people move up. Long story short, if you rely only on yourself, you won't get anywhere (read, it is a team effort)
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
Nothing will change. The rich get richer, the poor get poorer. It is all these inflation and crises that generated Bitcoin and other cryptocurrencies. As one famous person said, “Fiat money is the money of governments, and cryptocurrencies are the money of people.”
The problem with poor economies is that they no longer own their resources, their resources belong to corporations through controlled governments.
The problem is more complex than it appears
More specifically, there is no shortage in raw materials and natural resources. Whatever natural resources market you may look at, it is saturated with plenty of suppliers from different countries undercutting each other. The implication is that it doesn't give them any advantage as any of them can be easily substituted by another supplier. Apart from that, such countries have corrupt governments which are busy filling their pockets. They are not willing to improve the lives of their citizens as these citizens may no longer want these governments once they are better off overall
More specifically, there is no shortage in raw materials and natural resources. Whatever natural resources market you may look at, it is saturated with plenty of suppliers from different countries undercutting each other. The implication is that it doesn't give them any advantage as any of them can be easily substituted by another supplier. Apart from that, such countries have corrupt governments which are busy filling their pockets. They are not willing to improve the lives of their citizens as these citizens may no longer want these governments once they are better off overall
What you said expresses exactly what happens in Brazil.
Corrupt politicians tool everything, and the population experiences a lot of social inequality.
Banks dominate the economy, set abusive interest rates, and end up indebting the population.
Our minimum wage, in theory, should be adjusted annually to keep up with inflation, and today we have a salary of R$ 998 while the correct salary should be approximately R$ 4500. It is ridiculous, a country with so many resources, and so productive, to be so weak economically.
In my view, what makes the development of a country most difficult is the concentration of income and the social inequality caused by it.
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
It's high time that third world countries realise that it is industrialization and not natural resources alone that is going to make them leap from being a third world country to maybe an economic super power, They are over reliant on their natural resources and all they tend to do is to export them, if they are able to build factories that could transform their raw materials to finished products like developed countries do, they will end up being getting 10x the profits they make from exporting just the raw materials aloneIf only things were that simple
The problem is that countries which are already industrialized have a competitive advantage while the third world countries can't just proceed from exporting raw materials and natural resources to manufacturing finished products and retail-ready goods because they simply would not be able to stand the competition with the developed countries. So, instead of getting 10x the profits from exporting natural resources, they would only incur losses by producing subpar goods that will fail to market
To do what you suggest requires a lot more than just building factories as it also requires highly qualified labor force, technologies, capital, etc, as well as support from the big guns like the US opening their markets (see Japan as one such example) and it takes literally decades to go in that direction till finally getting there (or just somewhere)
The problem is more complex than it appears
More specifically, there is no shortage in raw materials and natural resources. Whatever natural resources market you may look at, it is saturated with plenty of suppliers from different countries undercutting each other. The implication is that it doesn't give them any advantage as any of them can be easily substituted by another supplier. Apart from that, such countries have corrupt governments which are busy filling their pockets. They are not willing to improve the lives of their citizens as these citizens may no longer want these governments once they are better off overall
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
One of the factors that is very likely to be a factor is that the country does not balance, the development of finance throughout the world, and creates their pressures for their economy, and also creates inflation for their county. but i believe every country have a plan to improve their state finances and economy whether to collaborate or investment with other countries or sell or lease their assets. many underdeveloped countries do that.
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
It's high time that third world countries realise that it is industrialization and not natural resources alone that is going to make them leap from being a third world country to maybe an economic super power, They are over reliant on their natural resources and all they tend to do is to export them, if they are able to build factories that could transform their raw materials to finished products like developed countries do, they will end up being getting 10x the profits they make from exporting just the raw materials aloneIf only things were that simple
The problem is that countries which are already industrialized have a competitive advantage while the third world countries can't just proceed from exporting raw materials and natural resources to manufacturing finished products and retail-ready goods because they simply would not be able to stand the competition with the developed countries. So, instead of getting 10x the profits from exporting natural resources, they would only incur losses by producing subpar goods that will fail to market
To do what you suggest requires a lot more than just building factories as it also requires highly qualified labor force, technologies, capital, etc, as well as support from the big guns like the US opening their markets (see Japan as one such example) and it takes literally decades to go in that direction till finally getting there (or just somewhere)
What we need is a decentralized unit of account that maintains its value no matter what. I like the DAI stablecoin because it aims to solve that problem. The only thing we can't solve is scalability, therefore have to accept that Bitcoin and other cryptos will likely never reach a state of total mass adoption. Perhaps that we can have some sort of a workaround through interoperability between various networks, but we haven't seen it be put to the test yet
Actually, there is a workaround to handle the volatility issue
As you can use Bitcoin as a store of value without compromising your wealth in dollar terms (read, you don't need stable coins for that). It is called hedging. In the simplest of cases, you open a short position on an exchange like Bitfinex which would be equal to your stash in the same coin (e.g. Bitcoin). And now you are no longer a hostage to volatility. No matter where the price goes, your wealth is intact
Indeed, you will have to provide some collateral (in case of Bitfinex something like 15% plus a little extra to make up for possible short squeezes) and so you become a hostage to an exchange. However, in the worst of cases you will lose less than a quarter of your stash. Further, with stablecoins you are still not safe as you depend entirely on the robustness of the system, and the DAI stablecoin you refer to is not 100% bulletproof either
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
A lot of underdeveloped countries have natural resources that could compare to those developed ones but they lack the technology or resources to develop them. Either that or their government would just rather quickly be rich by selling resources to developed countries and then pocket a huge amount of profit from there. The people can't really do anything about it since the government are the ones whom control almost all of the products that can be imported and exported and it's really sad to see that instead of trying to develop their own country, they develop their won pockets instead.
See, there could be many reason behind high inflation in developing countries.
One of them is huge trade deficit. Depreciating exchange rates can bring high inflation in a country. In this case, yes, the long term policies by the government where they can support people in developing such products themselves.
Second is the excessive credit. This can be controlled by tightening the monetary policy. Sometimes excessive credit is required in the economy to push the manufacture sector.
And the third is because of some natural disaster which corrects itself in mid run.
One of them is huge trade deficit. Depreciating exchange rates can bring high inflation in a country. In this case, yes, the long term policies by the government where they can support people in developing such products themselves.
Second is the excessive credit. This can be controlled by tightening the monetary policy. Sometimes excessive credit is required in the economy to push the manufacture sector.
And the third is because of some natural disaster which corrects itself in mid run.
The world economy keeps crashing with many incidence of inflation. What is happening at the moment is a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?
It is easy to say on paper but not possible to apply in practical. Underdeveloped countries like African and Asian countries are rich with natural resources and can do wonders if they get good value for their products. But they fall prey to the first-tier countries and their manipulative practices. First-tier countries especially European Union countries and USA have manipulated WTO to come to the arrangement where there is almost negligible import/export duty on raw materials but levy high duties on finished goods. So first-tier nations buy cheap raw materials from underdeveloped countries but sell them finished goods at inflated pricing. This leads to further depreciation in the value of fiat currencies of undervalued countries. Also they lack machineries and resources to consume natural resources in their own countries.
When you have got a badly intended people on the upper level of your country then it must be shown they way various type of hazard on your country, I think some underdeveloped countries always try to follow the decision from the developed countries by this reason they always remain the same position because of the capitalist policy. You know that the first world countries always try to extract the valuable thing from the poor counties and this is the way they wanna make a good relationship among these underdeveloped countries. so the situation will never change. this is the way we are going to face a huge crisis in the future.
Inflation happen all over the world currently not only in the underdeveloped countries and the best examples are the football players transfer as some years ago the most expensive transfer was 120 mil $ now a regular player cost like 100 mil $ this will lead to a new recession in the end, maybe even next year when we might see crazy low prices and people fired from jobs and so on.
Personally I take extra measures from now as the charts don't look good so speaking of underdeveloped countries, I don't see them in any good positions and instead I see new civil wars rising on Africa and also big money are moving to Asia from America. Speaking of Africa, I see they are desperate getting into bitcoin and trying to make legit projects and work hard like they never did before which is another strong sign that something shady is happening in underdeveloped countries. I would exclude Venezuela as there is a conflict zone first and then we can speak of the massive inflation that they are currently experience.
Personally I take extra measures from now as the charts don't look good so speaking of underdeveloped countries, I don't see them in any good positions and instead I see new civil wars rising on Africa and also big money are moving to Asia from America. Speaking of Africa, I see they are desperate getting into bitcoin and trying to make legit projects and work hard like they never did before which is another strong sign that something shady is happening in underdeveloped countries. I would exclude Venezuela as there is a conflict zone first and then we can speak of the massive inflation that they are currently experience.
Jump to: