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Thread: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    I believe the future is continued increased inflation - directly by prices increasing and indirectly thru lowered contents and lowered quality for the same price.

    Inflation reduces the value of debt and is a gradual decline it individual spending power and in the wealth of the nation. If wages increase in relation to the inflation, this benefits people with fixed debts such as fixed mortgages and overall equalized out. If a person's wages do not increase at the rate of inflation then the person is becoming poorer.

    Inflation also is a way to reduce social benefits, public assistance and welfare without voting to reduce it. With inflation, to reduce government assistance to people all the government has to do is nothing and inflation does the reductions.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    The most notable inflation of course is fuel, which has increased nearly 200% over the last 5 years. Another example is how increasingly bottles and jars with food products are largely indented at the bottom so a person does not see the bottle is smaller than it appears.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Anyone want to guess how much real disposable per capita income has increased since 1933? You know, AFTER inflation? If you believe the OP, it would seem that it has either stayed the same or decreased due to "inflation".

    Spooky scary inflation!

    Anyone?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Captain Adverse View Post
    I don't think so. That's just justification for permanent inflation, which would not be so prevelent if our currency wasn't issued by fiat.

    The only way to eliminate inflation is to reduce the amount of money available in a society’s economy. Less money causes consumers to focus on how they spend and what they spend money on. It instills a hierarchy of need in the minds of every consumer. I have a limited amount of money, what do I need, and then what wants can I afford after meeting my needs.

    This also drives consumers to think of long-term spending goals, which increases saving efforts. Savings provides money for banks to lend to businesses for expansion and development, and to encourage access to more capital to lend from savings accounts banks offer higher interests rates.

    Companies competing for consumer dollars offer better services and lower prices to offset competition. Aside from establishing a minimum wage to insure sufficient earnings to pay for necessities, there is no great need to make across-the-board wage increases that are not tied to an individual worker’s demonstrated productivity.

    For the same reason that consumer prices will balance, business costs will drop and then balance as raw material suppliers compete for corporate dollars.

    Fiat money is worthless, and because it can be printed at will inflation surely accrues. Inevitably, at some point people lose faith in this process. Tying it to a recognized commodity which has intrinsic worth means that the amounts printed are limited and can always be depended upon as having some relative intrinsic value. Inflation would be highly limited in fluctuating up an down under this system, as it would depend on actual levels of the commodity on which it is based. The only people who don't benefit are investment banks who can't juggle so much fiat money in attempts to lay claim to real property that provides their capital assets.

    As for your claim that real prices have been going down for years? What fantasy world does that come from? In order for consumer prices to "really be going down" we must focus on those products people would consider "needs;" and ALL of them, every single one, must be lower than any price for a similar item has ever been previously compared to both product quality and the past purchase power of the dollar. Otherwise you are just proclaiming something no one can see when they go out to purchase items in the marketplace.
    The only area prices go down is in relation to newly released upgrade electronics which are introduced at very high prices and then the prices rapidly fall.

    Another hidden inflation is reduction in product quality - which is one way WalMart seemingly offers "lower prices" - when actually for the value and/or lifespan of the product is it actually far more costly in the future given how often it must be replaced. I've posted about that before on personal experiences.

    An example was electrical connectors I bought. It was late at night and I needed some for a boat I was trying to get set up for the next day. I avoid WalMart for quality reasons but had no choice if I wanted to continue to work on the boat. However, after buying them and opening the package they were unusable. They had the same amount of plastic shield as non-WalMart connectors, but the actual metal under it was 1/3rd the length of the plastic shield - basically "a good trick." Not only were they unusable in general, had I tried they would both have a light likelihood of failing but also would have been a fire hazard.

    An hidden inflation is cheap crap that doesn't last replacing quality products - which are increasingly difficult to find at any price.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Kushinator View Post
    Anyone want to guess how much real disposable per capita income has increased since 1933? You know, AFTER inflation? If you believe the OP, it would seem that it has either stayed the same or decreased due to "inflation".

    Spooky scary inflation!

    Anyone?
    Disposable income? LOL Throwing more worthless paper in my direction while telling me "see you have more to buy with" claiming this proven due to cheaper, disposable, poor quality "non-needed" products I only rarely buy does not equate to more "disposable income." Especially when I am paying 50% or more out of those "higher wages" in rent costs when I used to be able to rent for 25% - 30% before fiat money came into play.
    Last edited by Captain Adverse; 07-29-13 at 10:18 AM.
    If I stop responding it doesn't mean I've conceded the point or agree with you. It only means I've made my point and I don't mind you having the last word. Please wait a few minutes before "quoting" me. I often correct errors for a minute or two after I post before the final product is ready.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by joko104 View Post
    I suppose you can ridicule over-weight people if you want, but it is pitiful that you think then you prove something by it other than something about yourself.

    Paying the same price for less product is hidden inflation and actual content sizes of many products including food is shrinking for the same product price. Your seeing this as your chance to laugh at overweight people is just what it is about yourself. The fact is that all people have to eat - not just people you ridicule and see yourself as superior to - and many people are increasingly having a difficult time being able to afford food.

    And since you apparently don't wipe your ass when you **** then yes, the price of toilet paper is irrelevant to you.
    Oh spare me your outrage and go fight evil giraffes trying to take over secret base in the Middle East all while under a CIA contract with a PhD student and a young beautiful Israeli woman named Shamza.
    I refuse to accept the view that mankind is so tragically bound to the starless midnight of racism and war that the bright daybreak of peace and brotherhood can never become a reality. - MLK

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Hatuey View Post
    Oh spare me your outrage and go fight evil giraffes trying to take over secret base in the Middle East all while under a CIA contract with a PhD student and a young beautiful Israeli woman named Shamza.
    Is that supposed to be humor?

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Captain Adverse View Post
    I don't think so. That's just justification for permanent inflation, which would not be so prevelent if our currency wasn't issued by fiat.
    You're half right on this point. It is true that we have had "permanent inflation" because we're on a fiat currency. IIRC the average annual inflation rate since dropping the gold standard is around 3%.

    You're missing the other half of the equation. Namely, when the USD was on or linked to a hard currency, or if it was otherwise fixed, the economy would yo-yo between periods of inflation and deflation.

    For example, during a deflation consumers slowly realize that the cost of goods will fall in 6-12 months, and they often put off major purchases. Companies react by reducing production and/or inventory, which means they fire people, which means people can't buy as much, which exerts more downward pricing pressure, and so forth. This is known as a "deflationary spiral." Not every deflation winds up causing a spiral. However, that was a key driver of unemployment during the Great Depression.

    You may have a few unusual situations like what we see now, where savings rates are below inflation rates, which slightly erodes the value of those liquid holdings. However, this in turn exerts pressure on citizens to purchase goods, which causes a virtuous spiral, opposite of the deflationary one. This is also a temporary situation, as indicated by how savings are at "historic lows."

    I.e as long as purchasing power keeps up with inflation, then low rates of inflation are not a problem.

    And moving to a fixed currency is not going to result in stable pricing. Quite the opposite, in fact. Which is one of many reasons why we use a fiat currency.


    As for your claim that real prices have been going down for years? What fantasy world does that come from? In order for consumer prices to "really be going down" we must focus on those products people would consider "needs"....
    I did not say that prices are exclusively falling, I said that some prices rise and others fall.

    And yes, this is visible to those who actually track prices.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Visbek View Post
    You're half right on this point. It is true that we have had "permanent inflation" because we're on a fiat currency. IIRC the average annual inflation rate since dropping the gold standard is around 3%.
    Thanks for admitting that much at least.

    Quote Originally Posted by Visbek View Post
    You're missing the other half of the equation. Namely, when the USD was on or linked to a hard currency, or if it was otherwise fixed, the economy would yo-yo between periods of inflation and deflation.[

    For example, during a deflation consumers slowly realize that the cost of goods will fall in 6-12 months, and they often put off major purchases. Companies react by reducing production and/or inventory, which means they fire people, which means people can't buy as much, which exerts more downward pricing pressure, and so forth. This is known as a "deflationary spiral." Not every deflation winds up causing a spiral. However, that was a key driver of unemployment during the Great Depression.
    I am not missing the "other half of the equation," because the yo-yo effect never caused that kind of problem. Your reference to the "Great Depression" downward spiral was based on a problem similar to fiat money, i.e. business growth based of the "promise" of available capital. When investors could purchase stock on margins as high as 90% this created an aura of false wealth businesses used to expand with. However, when brokers made margin calls due to business needs investors could not meet the demand, undermining the entire financial system. This "burst the bubble" of false wealth underlying economic growth and started a panic; the rest was history.

    Don't even try to blame that on representative money; that was wholly the fault of poor investment practices. The same attitudes about faulty investment practices current investment banks used that led to the recent Great Recesssion of 2008.

    Another factor people keep overlooking is the extensive use of credit that is creating more personal debt over the last 20 years than ever existed in our country prior. That's what many people are using today to access all those "wonderfully cheap TV's, computers, etc. etc. etc." not actual disposable income. People have taken up "deficit spending" almost as madly as out government.
    Last edited by Captain Adverse; 07-29-13 at 12:42 PM.
    If I stop responding it doesn't mean I've conceded the point or agree with you. It only means I've made my point and I don't mind you having the last word. Please wait a few minutes before "quoting" me. I often correct errors for a minute or two after I post before the final product is ready.

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    Re: HIDDEN INFLATION - "Fewer Sheets Needed to Get the job Done"

    Quote Originally Posted by Captain Adverse View Post
    Disposable income? LOL Throwing more worthless paper in my direction while telling me "see you have more to buy with" claiming this proven due to cheaper, disposable, poor quality "non-needed" products I only rarely buy does not equate to more "disposable income."
    A basic error in terminology. Disposable income is also known as income after taxes. Since you are struggling, we'll keep it simple; per capita income between 1933 and 2008, adjusted for inflation, has increased by 675%! So even though a plethora of goods and services are more expensive now (like a doctor, or gallon of gasoline), people are more wealthy than they have ever been.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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