How Inflation makes most people Poor.
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Inflation: in fiat currency base (erosion in value) for sure...
Quote:Originally Posted by MobbylandThread source(HWZ): "Inflation is good for the economy" theory: bollocks I say!
Inflation is a tool to moderate the market, and also a by product of the economy. Remember, you have to pace the Singapore economy against global market too.
Imagine an island of just 2 people.
One will harvest coconuts and one is harvesting apples.
Everyday, they just trade each other one coconut for 2 apples. This is what happened without inflation or deflation, everything will just remain stagnant.Oversimplicification fallacy: what I am talking about here (and the whole world presently) is inflation as cost of goods in fiat currency. If one were to use say gold coins as proxy, then inflation would be perhaps zero or even negative depending on the proxy value used- e.g. if an average compact car cost 10 oz of gold in 1930s (gold price was ~USD23/oz, of still cost 10oz to buy the same, albeit slightly modernised compact car (taxes not inclusive) (gold today is trading ~USD 1253/oz)- thus in gold terms, the value of the car HAS NOT been inflated, however, in dollar terms, the factory price of the same car type has risen from say US$230 to a whopping USD12,530 over the last ~80years. Actually, it was the value of fiat currency (USD) that depreciated.
So in the balance of things, when something appreciates in dollar value today, it is often because the number of dollars in circulation has increased, diluting the dollar value. Between desirable goods however, with the exception of natural calamity (storms/ famine causing seasonal shortage of food etc)/ bubble economics (hello kitty mania)/ change in taste (Fukushima radiation risk- sea food prices plummet), there is little change on the barter value between commodities.
As mentioned, prior to fiat currency introduction (1930s= partial; 1972= total), inflation under the gold standard of money exchange was practically NON-EXISTANT.
USA inflation: 1665 to 2005:
(image source)
SGD quantity inflation (printing) as a proxy to USD quantity inflation, just to keep exchange rates stable...,+M1,2,3,+1989+to+2012..JPG "Resized image - click to view original size")
(Image source)
And yes, if coconuts and apples were as desirable and as rare as they were (in your e.g.) before, the one fresh coconut will still yield 2 apples, now as it did then, its price in fiat currency regardless... -
Instead of $2.50 cai png, now it costs $3.50.
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dun worry, premier membership still same price
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premier membership can fill stomach or not?
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No.
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luncheon meat still available or not? :lol:
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Originally posted by charlize:
Instead of $2.50 cai png, now it costs $3.50.
Prices increase because quantitative easing (QE) just added more $$$ to the economy, so the value of your $$$ has deflated/ dropped. QE is like heating a pan with the ants quietly on it. As the temperature rises, the ants scamper non stop.
politician con men do the same thing although their motive is also to keep the ants alive. By running non-stop, many of the ants (citizens) will drop their belongings (lose their life savings to ponzi investment schemes or be motivated to spend on frivolities: cheap stuff that is actually useless/ overpriced). Many politicians are also connected to business owners or are business owners themselves. The consequence of all these confusion in society due to QE makes business rich, so by proxy, politicians also get enormously rich.
Fortunately, there is such thing as karma. Few if any of these corrupt politician actually die happy. They waste too much time devising schemes to cheat poor people than to live moral life well themselves.
Morally rich is the man who brings good to society, cursed is the man who brings evil. For the corrupt politician, his just deserts begin the day he sooner or later dies.
pls read Ben Bernanke's Potemkin economics is too expensive....... : http://sgforums.com/forums/10/topics/479583 to find out more...
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Amen. "The Lord shall wash away your sins if you repent" :lol:
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I will cry if luncheon meat becomes $1 per piece.
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:lol:
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:lol:
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Originally posted by charlize:
I will cry if luncheon meat becomes $1 per piece.
you can cry now because you can buy luncheon meat for $1, 30cm by 30cm, 30 mm thick.
you can pay $1.8 for a plate of beehoon with one piece luncheon meat and one fried egg. if you find luncheon meat is more than $1, pay $0.8 for the beehoon and the egg.
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:lol:
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Originally posted by sgdiehard:
you can cry now because you can buy luncheon meat for $1, 30cm by 30cm, 30 mm thick.
you can pay $1.8 for a plate of beehoon with one piece luncheon meat and one fried egg. if you find luncheon meat is more than $1, pay $0.8 for the beehoon and the egg.
I am awestruck by your amazing cost analysis of luncheon meat and bee hoon.
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:lol:
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Originally posted by charlize:
I am awestruck by your amazing cost analysis of luncheon meat and bee hoon.
enjoy your luncheon meat, take a small bite each time, chew it, taste and then swallow it slowly...you will enjoy every cent you paid, expensive or cheap.
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Originally posted by sgdiehard:
you can cry now because you can buy luncheon meat for $1, 30cm by 30cm, 30 mm thick.
you can pay $1.8 for a plate of beehoon with one piece luncheon meat and one fried egg. if you find luncheon meat is more than $1, pay $0.8 for the beehoon and the egg.
bro u see b4 luncheon meat 30cm x 30cm for $1? -
:lol:
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Originally posted by Genie99b:
bro u see b4 luncheon meat 30cm x 30cm for $1?ooops, its 3cm x 3cm...enjoy your luncheon meat.
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Teaser lah you.
i thought really got luncheon meat 30cm x30cm $1.
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:lol:
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