Stagnant Salaries vs. Inflationary Savings Tax

sekalitas

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

In the short term, I would definitely choose option A, but prolonged deflation isn't ideal. People tend to hoard money, believing prices will continue to drop, leading to decreased demand and economic slowdown. This creates a vicious cycle of falling prices and demand, ultimately harming businesses and employment. I could even end up unemployed due to a poor economy.

For the long term, I would choose option B. Moderate inflation is generally seen as a sign of a healthy, growing economy. It encourages spending and investment, as people and businesses are motivated to use their money before it loses value. In an inflationary environment, there's usually upward pressure on wages, as workers demand higher pay to keep up with rising living costs. This wage increase could potentially help maintain purchasing power.

MissNonFall9

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Quote from: lepbagong on May 27, 2024, 03:47:31 AM

Quote from: MissNonFall9 on May 22, 2024, 05:54:18 AM

Quote from: DeathAngel on May 22, 2024, 03:48:07 AM

Obviously Option A is far more preferable. I’m not an economist but I don’t understand why governments can’t just freeze consumer goods prices & inflation for a few years to help people manage their finances better. I have never understood why things cost far more over time, it doesn’t make any sense. All I can think is that it’s all driven by reckless government fiscal policies, money printing & spiralling national debts. Regardless I protect myself with Bitcoin. Nobody is printing my future into the dirt.

When the government does not control inflation or fix the prices of consumer goods, the system of government is corrupt. I also rely heavily on cryptocurrency or bitcoin to protect myself in such situations. Bitcoin helps me a lot to cover any unplanned expenses. However, the government often inflates inflation to maintain economic balance.

I agree, the role of the government is needed to intervene in situations where inflation occurs, because without intervention from the government, the prices of all the basic commodities needed will experience an uncontrolled increase, so that there will be no ability to buy and this could result in various problems occurring.
You are very lucky because you have used crypto during a situation that was not conducive to being able to cope with what you got from crypto, and not many people can use it like you.

At present most businessman in the market involve themselves in syndicates. I have seen that the farmers have no products in their hand because the syndicate businessman have taken them over long ago. Since the government is the head of the governance of a country it should regulate and supervise the market prices constantly considering the common people. Indeed those of us who are attached to the currency or Bitcoin are much luckier than others.

Dailyscript

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Quote from: CageMabok on May 15, 2024, 03:48:34 AM

Quote from: lepbagong on May 13, 2024, 11:14:08 PM

Inflation is very unpopular in any country, and you are right because inflation will disrupt the economy, making it difficult for everyone to meet the primary needs that must be obtained. If commodities can be suppressed or decreased and wages become stagnant, it will have no impact at all. It would be better if wages could actually increase, so that economic development will run better and everyone will be able to meet the needs for a decent living.

I also think that workers are still receiving stagnant wages in conditions like today.

This is the part that gets me angry the most. Workers are not receiving good pay and there salaries cannot meet up with the increase of inflation. Yet, the companies they work under whether government or private still owe them their salaries. Its very annoying because if they want people to work for them at a lower rate then they should maintain consistency in paying their workers. There are two things involve, which is its either they are paying more but they are inconsistent or they are paying less but maintaining consistency. People who choose to work for them based on this preferences.

beerlover

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Option A can't be done, prices don't fall and we just can't keep thinking about some dreamland constantly. Realize that governments are not fit to rule nations, but they are the only ones who have the right to, all those law makers will end up ruining the nations, and I am not talking about just one nation here, in ALL nations around the world, every government keeps making wrong decisions and every nation is getting worse.

I believe that we are not going to end up with anything that will benefit them, we should probably consider the fact that we are going to make a lot more money from just keeping our money in bitcoin because then we do not have to deal with any of this. If there is a problem with fiat, then bitcoin will be safely away from that.

lepbagong

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Quote from: MissNonFall9 on May 22, 2024, 05:54:18 AM

Quote from: DeathAngel on May 22, 2024, 03:48:07 AM

Obviously Option A is far more preferable. I’m not an economist but I don’t understand why governments can’t just freeze consumer goods prices & inflation for a few years to help people manage their finances better. I have never understood why things cost far more over time, it doesn’t make any sense. All I can think is that it’s all driven by reckless government fiscal policies, money printing & spiralling national debts. Regardless I protect myself with Bitcoin. Nobody is printing my future into the dirt.

When the government does not control inflation or fix the prices of consumer goods, the system of government is corrupt. I also rely heavily on cryptocurrency or bitcoin to protect myself in such situations. Bitcoin helps me a lot to cover any unplanned expenses. However, the government often inflates inflation to maintain economic balance.

I agree, the role of the government is needed to intervene in situations where inflation occurs, because without intervention from the government, the prices of all the basic commodities needed will experience an uncontrolled increase, so that there will be no ability to buy and this could result in various problems occurring.
You are very lucky because you have used crypto during a situation that was not conducive to being able to cope with what you got from crypto, and not many people can use it like you.

dunfida

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Quote from: Cookdata on May 22, 2024, 03:23:57 PM

Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

I don't like the two. Money supply is a long chain that continues to increase and as that number continues to increase, there must be a general increase in price of goods and services, so I don't think there is going to be a way where price of things will remain the same in a year, there must be a change in price and stagnant salary is a bad idea for any working class person that depend on pay check.

In an ideal situation right, option A will help stabilized the economy but will there going to be growth without change, money will obviously be printed and more money into circulation means that we will be shifting from an ideal situations to real state and inflation definitely set in, you don't expect not to have inflation when you borrowed money recklessly and then print more money than what is remaining in as foreign reserve, it will never work.

For the fun of discussion. I will go with option A still.

A. IMPOSSIBLE
B. THIS IS CURRENTLY HAPPENING

On situation A then there's now way that purchasing power has increased or would be having that deflation. If we do tend to make out some comparison about price of goods and services back in the past
then we would be able to see that huge gap about on how far we've been able to reach out or have become. So having this kind of condition will really be that impossible even into our dreams.
We would really be wishing this one but having knowing on how economics works then there's no way that we could really be able to apply such condition.

On situation B, then this is something which is inevitably happening.Whether we do like it or not inflation is something that could happen year by year.

Cookdata

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

I don't like the two. Money supply is a long chain that continues to increase and as that number continues to increase, there must be a general increase in price of goods and services, so I don't think there is going to be a way where price of things will remain the same in a year, there must be a change in price and stagnant salary is a bad idea for any working class person that depend on pay check.

In an ideal situation right, option A will help stabilized the economy but will there going to be growth without change, money will obviously be printed and more money into circulation means that we will be shifting from an ideal situations to real state and inflation definitely set in, you don't expect not to have inflation when you borrowed money recklessly and then print more money than what is remaining in as foreign reserve, it will never work.

For the fun of discussion. I will go with option A still.

MissNonFall9

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Quote from: DeathAngel on May 22, 2024, 03:48:07 AM

Obviously Option A is far more preferable. I’m not an economist but I don’t understand why governments can’t just freeze consumer goods prices & inflation for a few years to help people manage their finances better. I have never understood why things cost far more over time, it doesn’t make any sense. All I can think is that it’s all driven by reckless government fiscal policies, money printing & spiralling national debts. Regardless I protect myself with Bitcoin. Nobody is printing my future into the dirt.

When the government does not control inflation or fix the prices of consumer goods, the system of government is corrupt. I also rely heavily on cryptocurrency or bitcoin to protect myself in such situations. Bitcoin helps me a lot to cover any unplanned expenses. However, the government often inflates inflation to maintain economic balance.

DeathAngel

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Obviously Option A is far more preferable. I’m not an economist but I don’t understand why governments can’t just freeze consumer goods prices & inflation for a few years to help people manage their finances better. I have never understood why things cost far more over time, it doesn’t make any sense. All I can think is that it’s all driven by reckless government fiscal policies, money printing & spiralling national debts. Regardless I protect myself with Bitcoin. Nobody is printing my future into the dirt.

jrrsparkles

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Quote from: Uhwuchukwu53 on May 21, 2024, 05:03:56 AM

Quote from: jrrsparkles on May 20, 2024, 01:08:43 PM

Price will never increase, gotcha I will pick that for sure, why would I care about 2% which really means nothing especially for the salaried class and government is going to make the saved tax to go away in other way.

But prices of goods remain stagnant that is not even possible cause no one is really in control of the prices, it's just based on most factors but I would want the government to adjust the salary according to what the inflation rate is so that people can afford what they used to be instead of gradually starving to die.

I would say that this speak volume in my heart, allowing the government to act when there happened to be such an increase particular on goods is better because there is no way market determinant of price will be constant as law of demand and supply is concerned, it's possible, why thinking of this as possiblity one should first look at this two laws properly, secondly, death rate and birth rate it's critical clear that birth rate is always higher in population, therefore demand must increase on goods using 2% tax or charge to balance or State constant of goods can't work.

If demand increases then increase the manufacturing the product simple isn't it/ But that's not what I am talking about even in the short term it is impossible to keep the prices at constant price for example take the vegetables it's production rate depends on the seasons so one month there will be hundred tonnes available and next month it will reduced by half which means the price has to be doubled if the consumption remains same.

Uhwuchukwu53

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Quote from: jrrsparkles on May 20, 2024, 01:08:43 PM

Price will never increase, gotcha I will pick that for sure, why would I care about 2% which really means nothing especially for the salaried class and government is going to make the saved tax to go away in other way.

But prices of goods remain stagnant that is not even possible cause no one is really in control of the prices, it's just based on most factors but I would want the government to adjust the salary according to what the inflation rate is so that people can afford what they used to be instead of gradually starving to die.

I would say that this speak volume in my heart, allowing the government to act when there happened to be such an increase particular on goods is better because there is no way market determinant of price will be constant as law of demand and supply is concerned, it's possible, why thinking of this as possiblity one should first look at this two laws properly, secondly, death rate and birth rate it's critical clear that birth rate is always higher in population, therefore demand must increase on goods using 2% tax or charge to balance or State constant of goods can't work.

justdimin

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Quote from: lepbagong on May 20, 2024, 02:09:56 AM

Quote from: justdimin on May 15, 2024, 01:41:00 AM

Stagnant salaries are a big problem, in my country salaries are not going up a lot, I mean maybe just a little bit, but it is not even 20% of the inflation. Which means that everyone in the whole nation got a lot poorer and there is nothing we can do.

Overpopulation and education for all meant that we are going to have a lot more people fighting for the same jobs, and since there isn't enough jobs available, that means some people will be unemployed, and that means the workers can't ask for a raise, since there are many unemployed who are waiting to take their place. This was done on purpose, but unfortunately it doesn't really feel like it is going to end up making any type of money for anyone, and that seems like the problem.

Giving an increase when inflation occurs should be done, but sometimes companies cannot provide it according to inflation, because if they do, the company will experience losses and the company may close because of the losses received.
So that quite a few companies do not pay inflationary increases as long as they can hire employees and not lay off jobs.
Every year there will continue to be growth in jobseekers and there could be more than the availability of jobs themselves and this is a dilemma, so that companies can cut jobs by replacing them with new workers whose wages are cheaper.

I could not get the point; if there is inflation, whatever that company is doing should increase their revenue, if there is a product you sell for 5 dollars, you should sell it for 6 dollars because there is inflation. If your revenue increases, then the salary of the people who work there should increase as well.

If the company goes through an inflation period, without increasing their revenue, then they are doing something wrong and in that case making a loss would be their own trouble, they should figure out how to do better. Just because a company is mismanaged, doesn't mean that workers have to pay the difference and work for cheaper. Even if you give people a raise lower than the inflation rate, they are not getting a raise, they are getting less because of inflation.

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Price will never increase, gotcha I will pick that for sure, why would I care about 2% which really means nothing especially for the salaried class and government is going to make the saved tax to go away in other way.

But prices of goods remain stagnant that is not even possible cause no one is really in control of the prices, it's just based on most factors but I would want the government to adjust the salary according to what the inflation rate is so that people can afford what they used to be instead of gradually starving to die.

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Quote from: justdimin on May 15, 2024, 01:41:00 AM

Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Stagnant salaries are a big problem, in my country salaries are not going up a lot, I mean maybe just a little bit, but it is not even 20% of the inflation. Which means that everyone in the whole nation got a lot poorer and there is nothing we can do.

Overpopulation and education for all meant that we are going to have a lot more people fighting for the same jobs, and since there isn't enough jobs available, that means some people will be unemployed, and that means the workers can't ask for a raise, since there are many unemployed who are waiting to take their place. This was done on purpose, but unfortunately it doesn't really feel like it is going to end up making any type of money for anyone, and that seems like the problem.

Giving an increase when inflation occurs should be done, but sometimes companies cannot provide it according to inflation, because if they do, the company will experience losses and the company may close because of the losses received.
So that quite a few companies do not pay inflationary increases as long as they can hire employees and not lay off jobs.
Every year there will continue to be growth in jobseekers and there could be more than the availability of jobs themselves and this is a dilemma, so that companies can cut jobs by replacing them with new workers whose wages are cheaper.

bSpend

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

I never want to find myself in any of the situations mentioned above, the only situation I wanna find myself in is to wake up one morning and discover that I own more bitcoin than the united states of America.

With this, I never will have to worry about salary anymore, whether it be stagnant or not, and I also will never have to worry about fiat losing purchasing power due to increased inflation, and this is because the more fiat loss purchasing power, the more my bitcoins are adding more and more purchasing power.

Overall, option A looks or seems to many like the real deal, but lets not allow ourselves to be fooled, price of things will never continually go l down on a stagnant salary, but rather, they will go up due to inflation,, which is something that have become normal with the fiat system.

CageMabok

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Quote from: lepbagong on May 13, 2024, 11:14:08 PM

Inflation is very unpopular in any country, and you are right because inflation will disrupt the economy, making it difficult for everyone to meet the primary needs that must be obtained. If commodities can be suppressed or decreased and wages become stagnant, it will have no impact at all. It would be better if wages could actually increase, so that economic development will run better and everyone will be able to meet the needs for a decent living.

The problem is that workers' wages still seem difficult to increase in several countries, both by the government and by private parties who manage their own workers. So almost everyone has felt the impact of inflation at this time and I also think that workers are still receiving stagnant wages in conditions like today. Of course they can still be grateful even though this is only enough to support themselves on a daily basis without being in debt to certain parties. Because the decline in commodity prices is still difficult to reduce in conditions like today, so everyone must be willing to face this situation while facing inflation that is still occurring.

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased. It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

B- Having your savings taxed 2%+ a year by inflation.

Stagnant salaries are a big problem, in my country salaries are not going up a lot, I mean maybe just a little bit, but it is not even 20% of the inflation. Which means that everyone in the whole nation got a lot poorer and there is nothing we can do.

Overpopulation and education for all meant that we are going to have a lot more people fighting for the same jobs, and since there isn't enough jobs available, that means some people will be unemployed, and that means the workers can't ask for a raise, since there are many unemployed who are waiting to take their place. This was done on purpose, but unfortunately it doesn't really feel like it is going to end up making any type of money for anyone, and that seems like the problem.

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Quote from: Alphakilo on May 01, 2024, 01:49:31 PM

Which of these economic situations would you prefer to find yourself in?

Drop your thoughts

I would prefer point A, but is it possible for that to happen? So what I experienced was the opposite, goods increased but salary did not increase, even if there was an increase it was still less in terms of percentage, so it was still increasingly difficult to meet basic needs day by day, except looking for additional income which is also quite difficult to obtain in developing countries like where I live, I don't mean to complain but in poor and developing countries many workers do not receive salaries according to standards so salary increases do not have much impact, if the initial salary meets the standards then the salary increases will still provide the ability to purchase goods even if they rise.

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Quote from: blckhawk on May 14, 2024, 12:04:35 AM

I'd take the stagnant salary assuming that the prices of goods and services are stagnating too then that's not a bad idea at all because that means that I can buy everything without worry that my money won't be enough. That's like a dream come true, no inflation or deflation but you've got a consistent money, that's going to be a dream for me, I don't know if everyone shares the same sentiment with me but that's how I see it. The fact that there's no upside to the 2nd option makes the 1st option the best one you can pick, really weird to be picking that one, your savings slowly chipping away because of taxes, hell no to that one.

That is how it should be, the gold standard lasted for so long because it allowed business owners to know precisely the costs of investing, as each currency was backed by gold and they could make long projections about those costs.

But when countries began cheating the gold standard and eventually the fiat system imposed itself, we ended up with a system that punishes you for saving with the use of the inflation tax, and even if a lot of people do not understand this, they can feel it, which explains why on the west so few people save any money, because they know it makes no sense to do it under the current circumstances.

blckhawk

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I'd take the stagnant salary assuming that the prices of goods and services are stagnating too then that's not a bad idea at all because that means that I can buy everything without worry that my money won't be enough. That's like a dream come true, no inflation or deflation but you've got a consistent money, that's going to be a dream for me, I don't know if everyone shares the same sentiment with me but that's how I see it. The fact that there's no upside to the 2nd option makes the 1st option the best one you can pick, really weird to be picking that one, your savings slowly chipping away because of taxes, hell no to that one.

Topic: Stagnant Salaries vs. Inflationary Savings Tax (Read 689 times)