Re:America’s Dazzling Tech Boom Has a Downside: Not Enough Jobs
by jomamaxx on Thursday October 13, 2016 @04:39AM
(#12699327)
Scarcity changes the price of something.
Inflation can really be thought of as expansion of the money supply while all other things remain steady - stuff just arbitrarily gets more expensive.
Central Banks target 2% inflation so that we don't fall into a deflationary trap. It's like keeping the treadmill running just a little bit, to force the person to run forward.
Austrian school economists basically equate inflation with money printing - to them it's the same thing.
But most things increase in price due to a) better quality product and b) regular dynamics of business c) currency.
So when the beer gets more expensive it's:
a) Better beer (at least in the eyes of the consumer), i.e. longer brew times, better taste, better ingredients
b) More expensive input costs
c) Currency issues with imports etc.
Those are not inflation, just price fluxuation.
Inflation is when the exact same thing gets costlier, all other things being equal.
Inflation can really be thought of as expansion of the money supply while all other things remain steady - stuff just arbitrarily gets more expensive.
Central Banks target 2% inflation so that we don't fall into a deflationary trap. It's like keeping the treadmill running just a little bit, to force the person to run forward.
Austrian school economists basically equate inflation with money printing - to them it's the same thing.
But most things increase in price due to a) better quality product and b) regular dynamics of business c) currency.
So when the beer gets more expensive it's:
a) Better beer (at least in the eyes of the consumer), i.e. longer brew times, better taste, better ingredients b) More expensive input costs c) Currency issues with imports etc.
Those are not inflation, just price fluxuation.
Inflation is when the exact same thing gets costlier, all other things being equal.