Topic: Risk of Inflation in Economy. - page 8. (Read 1641 times)
The rate of inflation varies within the country for we do have different resources and the state of economy matters depending on how the government and the people do manage to make use of the limited resources to be produced as goods and services being consumed by the mass public. Having bad governance and lack of resources might be a factor to cause the drastic change in terms of prices making higher inflation rate to arise making people do suffer within the economic state they belong.
There's actually very little inflation in the economy right now.
What is very worrying is that people are expecting high inflation. And because of these inflationary expectations, you could have a self-fulling prophecy situation where inflationary expectations alone are able to lead to actual inflation in the future.
The quantitative easing and the myriad of fiscal stimuli are going to come at a cost, one way or the other. There is absolutely no way around that, although most policymakers still seem delusional about the potential consequences for some reason.
What is very worrying is that people are expecting high inflation. And because of these inflationary expectations, you could have a self-fulling prophecy situation where inflationary expectations alone are able to lead to actual inflation in the future.
The quantitative easing and the myriad of fiscal stimuli are going to come at a cost, one way or the other. There is absolutely no way around that, although most policymakers still seem delusional about the potential consequences for some reason.
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I have to disagree with you. Not all the assets are impacted by inflation at the same degree. For example, the price of commodities and assets that are plentiful will not go up much even if hyperinflation occurs. And this is applicable to food products, electronics, manufactured goods.etc. On the other hand, goods and services, as well as assets that have a limited supply will go up much more when compared to the first category. Yeah, but he was talking exactly about basic food and necessities, not about investments or other assets, those are not on the to be concerned about the list of people who struggle right now with money. As for services, I've actually checked all my utility bills right now and I see no actual change in them for like two years, nothing in from the ISP, telecom, gas, actually my electric bill went down about 1 eurocent per kWh, deliveries, cab fares, almost nothing has moved enough to catch my attention.
Of course, it's different from country to country, but in the end, it all goes down to stop electing morons in power, if some countries can avoid hyperinflation after a crisis it means the problem is with the ones making decisions.
How can you say that Ethereum and Polkadot are vulnerable to inflation, when their maximum supply is fixed?
Ethereum doesn't have a hard cap supply.
Inflation is also a big danger for crypto. So many Shitcoins have huge inflation, like Ethereum or Polkadot. Such coins have a big risk of being devalued.
It is similar to cash, if more of it gets printed / staked price will go down per coins and holders will suffer inflation.
We should always only buy crypto where no inflation is a fact (like Bitcoin).
It is similar to cash, if more of it gets printed / staked price will go down per coins and holders will suffer inflation.
We should always only buy crypto where no inflation is a fact (like Bitcoin).
How can you say that Ethereum and Polkadot are vulnerable to inflation, when their maximum supply is fixed? You can say that Dogecoin is vulnerable to inflation, because the maximum supply is not fixed. That is not the case with Ethereum. And they haven't implemented the PoS algorithm yet.. probably because they are not confident about it. In the end, Ethereum may end up with a hybrid algorithm with both PoS and PoW. But that shouldn't change the limit on maximum supply and therefore it should be safe from inflation.
Inflation is also a big danger for crypto. So many Shitcoins have huge inflation, like Ethereum or Polkadot. Such coins have a big risk of being devalued.
It is similar to cash, if more of it gets printed / staked price will go down per coins and holders will suffer inflation.
We should always only buy crypto where no inflation is a fact (like Bitcoin).
It is similar to cash, if more of it gets printed / staked price will go down per coins and holders will suffer inflation.
We should always only buy crypto where no inflation is a fact (like Bitcoin).
This is the maximum I would the overall prices rise to..
I live in Europe, some things have gone up in price but some are staying flat, basic food that is produced locally and it's not seasonal is barely changing, I put a 10% just to draw a median. Besides, as I said the rise is temporary, supply chains being broken, in some cases like beef because governments are trying to "protects" their consumers by banning exports and so on and on, the spike in prices is not here to stay indefinitely, as they grow production will ramp up because it's profitable, more production less imbalance.
But at the same time, you can't expect that all those production and distribution chains that have been cut or at least heavily affected for almost a year to resume normal work in a matter of days or weeks.
I live in Europe, some things have gone up in price but some are staying flat, basic food that is produced locally and it's not seasonal is barely changing, I put a 10% just to draw a median. Besides, as I said the rise is temporary, supply chains being broken, in some cases like beef because governments are trying to "protects" their consumers by banning exports and so on and on, the spike in prices is not here to stay indefinitely, as they grow production will ramp up because it's profitable, more production less imbalance.
But at the same time, you can't expect that all those production and distribution chains that have been cut or at least heavily affected for almost a year to resume normal work in a matter of days or weeks.
I have to disagree with you. Not all the assets are impacted by inflation at the same degree. For example, the price of commodities and assets that are plentiful will not go up much even if hyperinflation occurs. And this is applicable to food products, electronics, manufactured goods.etc. On the other hand, goods and services, as well as assets that have a limited supply will go up much more when compared to the first category. I am talking about bullion, skilled labor, collectibles.etc. If people have a lot of spendable money, then the value of these assets may go up by 50% or 100% in a short period.
Where do you live that 10% change is not a lot to you?
This is the maximum I would see the overall prices rise to..
I live in Europe, some things have gone up in price but some are staying flat, basic food that is produced locally and it's not seasonal is barely changing, I put a 10% just to draw a median. Besides, as I said the rise is temporary, supply chains being broken, in some cases like beef because governments are trying to "protects" their consumers by banning exports and so on and on, the spike in prices is not here to stay indefinitely, as they grow production will ramp up because it's profitable, more production less imbalance.
But at the same time, you can't expect that all those production and distribution chains that have been cut or at least heavily affected for almost a year to resume normal work in a matter of days or weeks.
This is correct, smart people know that sooner or later a crash of the economy will come because the inflation is simply too high, governments have printed so much money lately with the excuse of the pandemic that high levels of inflation for years are a given, and when people cannot get more money
You're contradicting yourself.
Besides, in hyperinflation people are having too much money and not able to spend, not the other way around.
It is not possible for the people to avoid the risk of rising prices of the economy. It is under the control of the government when the prices of the economy go up it puts pressure on everyone high levels of defaulting debt have already put the financial sector at extreme risk and fragile investment conditions have put the economy under pressure. Weak revenue collection if revenue is not collected as per the target there will be pressure on budget implementation. Besides lack of corporate good governance in the banking sector even excess liquidity poses a kind of risk to the economy.
indeed inflation is unavoidable, but the task of the government is to suppress inflation so that it does not skyrocket. I think that with the increase in people's welfare, inflation will not have a major effect on the life of a country. besides that, with good state management, of course it will help the strength of a country's economy
That is what is worried if there's inflation in almost all parts of the world, it will be difficult for the economy to move
All sectors will inevitably have an impact, especially new started small businesses will certainly find it difficult to survive
All sectors will inevitably have an impact, especially new started small businesses will certainly find it difficult to survive
It is not possible for the people to avoid the risk of rising prices of the economy. It is under the control of the government when the prices of the economy go up it puts pressure on everyone high levels of defaulting debt have already put the financial sector at extreme risk and fragile investment conditions have put the economy under pressure. Weak revenue collection if revenue is not collected as per the target there will be pressure on budget implementation. Besides lack of corporate good governance in the banking sector even excess liquidity poses a kind of risk to the economy.
Trust me, government officials are well aware of inflation, they just don't care because it's more convenient in the "now" to turn the printer into overdrive and create money out of thin air instead of fixing systemic problems. The US within the last year has printed more money than ever has existed in history before -- it's not like Americans are brain dead and don't understand fiscal responsibility. They knew the currency would bloat up, they just didn't care because it's a problem that can be pushed onto the next guy.
What's terrifying is the money the US owes to China. What happens when the US economy crashes? Surely that will effect China's economy if/when they default on their loans. And then what? Two of the largest economies in the world crash? Scary.
Just now, the most important thing for the government is to fight the coronavirus and overcome the negative phenomena for the economy, and the launch of a printing press for this is the most affordable and seemingly safe measure. Another question is how safe it is depends on the amount of money being printed and how efficiently the economy can digest it. However, judging by the volume of the stock market and the explosive growth of cryptocurrencies before this, it was clear where the excessive amount of money goes, but the situation is not stable and the current situation with the collapse of the bitcoin exchange rate suggests this. Therefore, we will monitor the situation and hope for the best, but the most important thing is to defeat the coronavirus epidemic. What's terrifying is the money the US owes to China. What happens when the US economy crashes? Surely that will effect China's economy if/when they default on their loans. And then what? Two of the largest economies in the world crash? Scary.
inflation happen if people have mich money, and there is rarely to buy some product. and all of stuff increase their price in a long time. people cant handle in brief, need step and more step to make it normal.
need to know about economy of country itself is good, people can help just a little bit to roll their money. and team work by government and general public is needed to improve own country.
need to know about economy of country itself is good, people can help just a little bit to roll their money. and team work by government and general public is needed to improve own country.
That's why many people and institutions are looking for an alternative asset that is not affected by inflation and makes their money grow by hedging into it. That is the reason why some companies are putting their money into cryptocurrencies like Bitcoin. It's just that it's best to prevent that, and with the current economy and tragedies that we are experiencing right now, it's a good approach to it.
This is correct, smart people know that sooner or later a crash of the economy will come because the inflation is simply too high, governments have printed so much money lately with the excuse of the pandemic that high levels of inflation for years are a given, and when people cannot get more money due to the high levels of unemployment and the small wealth they have is consumed by inflation then there is no way out of this and sooner or later we will face huge levels of hyperinflation. 
Our economy change drastically and very tangible of the eyed of everyone. We can not control the economics cycling in out of the world. More people suffer that can not afford to buy due of high demand of the prices the situation of the poor status it's getting vulnerable so it is really hard when we're in point of the high inflation more risk we can experience.
Some countries are not into economy crisis and some are not into economy crisis, so from this scenario we have to know that development or betterment of a country economy depends on their management which can likely caused through their political leaders.
While countries suffer for higher demands of beverages and other materials use for industrial purposes and food consumptions, is because of lack of management and poor diversification of country economy, some countries focus on one source of revenue, so if the source happens to crash, it's obvious that the country will engage into economy crisis which will absolutely bring shortages of income.
So our upliftment in the country replies on the government heads who are piloting the affairs of the country, from my observation it's quit understood that what causes a lot of controversial issues that lead some countries into massive problem is embezzlement of funds and poor source of generating revenue.
Our economy change drastically and very tangible of the eyed of everyone. We can not control the economics cycling in out of the world. More people suffer that can not afford to buy due of high demand of the prices the situation of the poor status it's getting vulnerable so it is really hard when we're in point of the high inflation more risk we can experience.
The economy was bound to end up this way, right when the pandemic started back in early last year, it was a signal that there was going to be an economic collapse. With lockdowns, people not working and businesses shut down etc, it was basically obvious that there'll be a downturn in the economic affairs of many countries, and even still on that, policies like printing of more money to bring the pandemic under control, didn't quite help matters, now we're faced with inflation/hyper inflation, and with the look of things, it may only get worse for our economy/Fiat from now going forward.That being said, the situation has allured quite a lot of people to assets that can hold the value of funds during periods of inflation, like Bitcoin for example, we see how the institutional investors, prominent individuals and the rest are now interested in the network, and this growing interest is likely to increase as the Inflation levels gets worse.
Isn't it a strange world we live in where not overprinting fiat is considered unattainable rocket science to many states and regulatory authorities. Even more strange is how determined many are to refuse to acknowledge basic rules and principles of finance/economics applying even to large governments with trillions in assets.
There could be a certain anti intellectualism involved in believing humanity has evolved beyond basic laws of science and money. A trend people might want to reverse before circumstances deteriorate further.
Inflation is a relatively harmless things by itself. The real problem is convincing people circumstances leading to inflation are real problems that need addressing. Civilization appears to have reached a point where inflation is considered to be as mythical as aliens. It could be a concern.
There could be a certain anti intellectualism involved in believing humanity has evolved beyond basic laws of science and money. A trend people might want to reverse before circumstances deteriorate further.
Inflation is a relatively harmless things by itself. The real problem is convincing people circumstances leading to inflation are real problems that need addressing. Civilization appears to have reached a point where inflation is considered to be as mythical as aliens. It could be a concern.
Trust me, government officials are well aware of inflation, they just don't care because it's more convenient in the "now" to turn the printer into overdrive and create money out of thin air instead of fixing systemic problems. The US within the last year has printed more money than ever has existed in history before -- it's not like Americans are brain dead and don't understand fiscal responsibility. They knew the currency would bloat up, they just didn't care because it's a problem that can be pushed onto the next guy.
What's terrifying is the money the US owes to China. What happens when the US economy crashes? Surely that will effect China's economy if/when they default on their loans. And then what? Two of the largest economies in the world crash? Scary.
Our economy change drastically and very tangible of the eyed of everyone. We can not control the economics cycling in out of the world. More people suffer that can not afford to buy due of high demand of the prices the situation of the poor status it's getting vulnerable so it is really hard when we're in point of the high inflation more risk we can experience.
High inflation is the a very big risk factor for our saving. If we keep cash at home or in an saving account at a bank, than a few years of high inflation will cripple the purchasing power of our FIAT money. There are a few ways to save our money from inflation. One way would be to buy stocks, the return is higher so it would compensate for the higher inflation, but in stocks is also more risk, we could lose money here. A better option in my opinion to protect ourself are treasury inflation protected securities (TIPS), they are basically bonds who pay a premium based on the inflation rate each year. So the higher inflation, the higher the cocupon. If we want to save long term FIAT money than we should definitely buy some of those.
Even putting money into bitcoin won't solve the situation because you are part of the country or system and when you make withdrawal of the coins or converted form, you still use it to buy in an inflated system, the worth of what you are getting will be lower if it was not inflation. Inflation is a big challenge to every economy.
Are you sure about what you are talking about? Yeah, it is like that but no matter what the situation is, it's always going to be better for your capital to have more in USD or in BTC. The way that you can not be affected by the inflation of USD is by not letting your money stay in USD. In that way, you lessen the effects. Taking advantage of the current volatility of your assets as well. If you compare the amount of USD you will have with the following
- Hedged with Crypto
- Just HODLed USD
You will end up having more USD when you hedge against crypto because of the value of crypto will rise since the value of fiat will lessen.
That's why many people and institutions are looking for an alternative asset that is not affected by inflation and makes their money grow by hedging into it. That is the reason why some companies are putting their money into cryptocurrencies like Bitcoin. It's just that it's best to prevent that, and with the current economy and tragedies that we are experiencing right now, it's a good approach to it.
Even putting money into bitcoin won't solve the situation because you are part of the country or system and when you make withdrawal of the coins or converted form, you still use it to buy in an inflated system, the worth of what you are getting will be lower if it was not inflation. Inflation is a big challenge to every economy.
This case is worsened in my Country, every day you witness a change in the price of goods and services and this is affecting the purchasing power of the poor and even the middle class. I hope very soon things will fall back into the right place.
Your country may not be the only one experiencing high inflation. Many other countries complain of it. It is becoming a new normal like covid-19.
This case is worsened in my Country, every day you witness a change in the price of goods and services and this is affecting the purchasing power of the poor and even the middle class. I hope very soon things will fall back into the right place.
I am sorry to disappoint you maybe but I don't see anything improving soon because a lot of governments are just hapless since they don't have any resources to come out of this massive economic-cavity caused by the virus and many countries are still facing it. Imagine the damage caused by all the lockdowns, shutdowns and forced curfews to the economy of the countries. There might be the lowest low in terms of economic crisis in the coming time but a glimmer hope is that, in the coming few years I can see the economy getting back to normal as businesses get back to operating again.It's really important to treat inflation as a serious issue, inflation can be really dangerous for the country and also the people.
If a country was facing inflation before the virus they should be in a hyperinflation situation by now because even the top-performing countries in terms of inflation have failed to stop the inflation problem so one can only imagine what already suffering nations must be going through right now. Jump to: