Re:Australia's Housing Frenzy
by KKKKkkkk1 on Saturday November 25, 2017 @11:25AM
(#15776571)
How does printing money make the rich richer? Isn't it exactly the opposite?
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Rich people borrow lots of money and buy assets.
Look at Donald Trump’s son in law as an example — I use him not to make a political point but because there’s alot of public information out there. He uses cheap capital to buy lots of cash flow in the form of apartment complexes. Being deeply in debt means that his liabilities get discounted by inflation, while inflation allows his company to escalate rents.
If you have cash or equity now, the smartest move you can to make is to borrow as much as you can afford and buy assets like real property or businesses that generate cash flow. Businesses like laundromats are probably more valuable than tech investments in the next decade.
The real winners of classic inflation are debt holders. The high inflation in the 70's contributed enormously to a generation that purchased a home and paid a lot less in real terms.
Re:Australia's Housing Frenzy
by branchless on Saturday November 25, 2017 @12:15PM
(#15776769)
the rich are not in cash, they are in assets. Workers lose out under inflation (and I mean real inflation not some bullshit figure the state concocts).