Want to read Slashdot from your mobile device? Point it at m.slashdot.org and keep reading!

 



Forgot your password?
typodupeerror
Check out the new SourceForge HTML5 internet speed test! No Flash necessary and runs on all devices. ×

Comment Re:Inflation is tax on savings (Score 1) 228

If you prefer a different term for "assets that increase in value over time: the means of production", well, that's fine, but inflation is not a tax on that stuff, and that stuff is what "wealthy people" mostly own. Inflation is not a transfer of wealth from "wealthy people" to whomever the government sends money to, because "assets that increase in value over time: the means of production" hold value.

Even if you want to claim that savings accounts are wealth, the rate of inflation doesn't change the rate at which savings accounts lose value, except at the extremes. You pay for safety (you pay disproportionately to the actual risk). Higher inflation, in the 1-5% range where stable economies lie, is not a higher tax on savings accounts. Even if there were no inflation, savings accounts would have some fee structure (or negative interest rates), because people will pay for safety.

As far as money failing as a store of value, yep, what else is new? The only thing that holds value remains "assets that increase in value over time: the means of production".

Comment Re:Wrong even if correct (Score 1) 228

If you're trying to make a point, or explain an argument, it's lost in your noise. If you're talking about "demand for money" in the usual economic sense, that of demand for borrowed money, then that directly affects interest rates, but affects inflation only indirectly. (If you're talking about demand for physical currency to stuff in a mattress, that's something different.) Obviously, money supply can affect inflation but it's elastic - inflation really isn't the time derivative of the money supply, unless the currency has already collapsed.

Comment Re:Inflation is tax on savings (Score 1) 228

That's an interesting definition, could you cite, where you got it from?

It's the old-school definition, the definition one uses to become or remain wealthy. The means of production are really the only thing that has value by something other than convention.

it totally ignores non-productive wealth, such as precious metals, Bitcoins, intellectual property, and currency. By your definition, an owner of, say, a shoe-repair shop is richer than a guy with a $10 mln bank-account...

Many things have value, but not all valuable things are wealth. Roughly speaking, you have:
* "bling" - stuff that costs significant money to maintain, like a fancy car
* parked money - non-productive land, gold, safe loans, etc
* speculative gambling
* wealth - ownership of the means of production

Wealth is the thing that (long-term average) grows over time. Everything else is a (risk- and inflation-adjusted) loss on average. For centuries, wealth was "assets that produce income", which was basically only farmland. Land was valued not by it's purchase price (a newer notion than you'd think) but by its annual income. As economy theory grew up, "the means of production" became the more clear concept.

Note that there's a useful notion of wealth that includes your labor - you have a sort of inherent wealth because you can be productive. Sometimes that's a very useful notion of wealth.

Which means, that whoever earned those dollars lost some of their value. Where did it go

They had value only by convention and that convention changed.

Now, it is not tax on all forms of wealth, merely on savings held in dollars.

Assuming you shop around for savings accounts (instead of just getting taken by the place you happen to have a checking account with), you can consistently get a bit less interest than inflation. When inflation rises, the interest rate for the best savings accounts will rise as well (ditto new CDs). Rising inflation shouldn't really be a tax on savings, except people are too lazy to move their savings if needed when rates rise and banks take great advantage of this.

Of course, all that's out the windows when US savings interest rates hit the legal maximum of 5.25%, but that's how euro-dollars came to be (dollar savings accounts at a European bank - all the rage in the Carter years).

Comment Re:Here's an idea (Score 2) 204

Your fallacy of poisoning the well does not constitute an argument. Sophistry, sure, but that's different.

You have asserted "without the marketing by these entities you would never have found your favorite bands," but you have yet to make an argument for that position. I'm beginning to doubt that you can.

Comment Re:Here's an idea (Score 2, Insightful) 204

I haven't found music through marketing since I was a teen. Sure, marketing in any industry will always be able to sell inferior crap to the ignorant, and that may never change, but there are plenty of ways to discover music these days. Heck, do labels even bother with payola any more (do kids still listen to the radio?).

These days I usually discover new artists through the various "people who bought/listened to X also bought/listened to Y" algorithms on Amazon, YouTube, etc. I think a lot of people find new music through Spotify's algorithms (has there been a Spotify payola scandal yet?).

Marketing was just more important in the days of broadcast media and limited distribution channels for records. Now there's no scarcity of airtime or shelf space.

Comment Re:Wrong even if correct (Score 1) 228

If both increase at the same rate, there is no inflation, you economically ignorant fuck

Ah, such reasoned discourse is what makes Slashdot special. In the simplest model, sure, we have 4% more money and 4% more stuff, so prices should be stable, right? But instead demand leads supply in a growing economy, so prices go up.

Plus, economic growth tends to be more in areas where people have a choice whether or not to buy (or purchases can at least be delayed), while measuring inflation is weighted towards basic staples where people buy more-or-less the same amount in good times and in bad. So we have 2% more money, but the same amount of deodorant being produced and consumed.

So, yeah, we don't get 4% inflation - it's not a direct measure of the derivative of the money supply - but we get typically 2-3% inflation when the economy growths 4%.

Comment Re:Inflation or Rally? (Score 1) 228

They would not even seek to stop it, considering the value of 1-2% per year "normal" (that's a tax on wealth, BTW).

Inflation is not a tax on wealth. Wealth is the ownership of the means of production, which has it's own value. If dollars have less value, the number of dollars needed to buy the means of production increases. However, deflation, or over-high inflation, can hurt the economy and thereby reduce the value of the means of production, but that's a very indirect effect (and usually temporary).

Inflation hurts existing (fixed-rate) debt-holders. If you have bonds, or CDs, or some other fixed-rate instrument, you're hurt when interest rates rise. But that's not wealth - it's either parked money or speculation (depending on how safe).

Comment Re:Wrong even if correct (Score 2) 228

Inflation is a symptom of a healthy economy. The money supply should be increasing as the economy increases. The causation doesn't work the other way though - no one has ever spurred economy growth by trying to cause inflation (though Japan tried for 20+ years without success). You can't push on a rope.

Another nice feature of low inflation is that it avoids annoying negatives. Safe ways to park your money (e.g., savings account) pay a bit less than inflation, which gets very awkward if inflation is 0 or negative. Similarly, the graceful way to handle employees paid more than the market value of their work is to give them a raise smaller than inflation, and let it equalize over time - which, again, stops being graceful if inflation is 0 or negative.

Comment Re:*** INFINITE FACEPALM *** (Score 1) 86

This is what they call a "solution looking for a problem".

I normally use information to decide if I need an umbrella - I don't randomly go around the house touching things and waiting for an LED to flash.
What next? The "am I thirsty" waterbottle? Oh wait we already made that.

Seriously, this is like autonomy-inversion.

Ah, but this way the umbrella catches fire. How many flaming umbrellas do we get your way, eh?

Comment Re:This works for me (Score 1) 406

Heh, Italy just rejected the attempt to create a new Mussolini, signalling that an Ixit is likely on the Horizon - a move that's been called "Trump-aligned" as well as "Brexit-aligned".

Rejecting the power of a central government to impose unwanted immigration on the people is an anti-authoritarian move.

Comment Re:This works for me (Score 0) 406

I'm old enough to remember how Regan was Hitler. We all remember how Bush was Hitler. But, hey, I'm sure there's a wolf this time.

Also, your characterization of people* who say "let's have less immigration while the economy sucks" as "supremacists" is cute. They must be racists, right? It's also the reason Trump won. Keep it up.

(*) About 1/3rd of America, ditto Brexit voters and the coming Ixit voters.

Slashdot Top Deals

To spot the expert, pick the one who predicts the job will take the longest and cost the most.

Working...