prices go up?
Why.
Help.
Why is government printing more money and giving it to me a bad thing. I need it to live.
I’d like both the econ101 (fake, lib, propaganda) and the marxist (real, truth, based) answer pls.
prices go up?
Why.
Help.
Why is government printing more money and giving it to me a bad thing. I need it to live.
I’d like both the econ101 (fake, lib, propaganda) and the marxist (real, truth, based) answer pls.
:meow-hug:
So computer says to increase price. Business increases price. We pay more. But then we have less to pay for other stuff. Right? So other businesses have to reduce price? No?
Edit: or we just chose company that didn’t increase price?
It's not coordinated well enough between firms, so the computers could always break the economy. There's a few valves being turned, part of the model are wage surveys and government stats so in theory the market can bear the cost increase. My particular thing was retail self storage, so people renting storage lockers, usually because they got evicted or were in otherwise dire straits. A portion of the business came from things like pharma reps/drug dealers, like lawn care businesses and some other types that wanted to store things around and not have to drive further somewhere to get some equipment or whatever. So those could pass the cost on to someone, or just take lower profit margins themselves.
If existing customers couldn't afford it then they either moved their stuff out/threw it away, or called the store and the manager looked at the computer and decided based on how they were feeling that day and how racist/annoyed they were by the customer to give them a manual override on the price. Or stopped paying for the unit and then it went to collections, usually ended up auctioned off (sight-unseen by law) and hopefully that at least covered the back rent. Some people got checks because it covered more than the rent, but that was rare.
In the broader market, there will be people who (and businesses which) just run out of cash. They'll usually find some meager form of public assistance, or take on debt. Downsizing, reducing standard of living, theft to get by are also levers that consumers pull. The debts are held by banks, who get bailed out when things get really bad.
That sounds like a soul sucking job. Sorry you had to go through that.
I’m getting the sense that banks taking on the debt and then getting bailed out is a fundamental fucking aspect of this system, given how many people have mentioned it.
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When the govt bails out the banks (by paying them what is owed by the people), that also causes inflation then right?
Do the govt can just “bail out” the people instead.
Why would they do that? People do not fund political donations, banks do. Also, all of these people and their kids have gone to the same schools, same circuits, same parties, sometimes for generations. It's real cool club, and you're not a part of it.
No no I know, I’m saying a good govt can bail out the people and tell companies to not increase costs and thus not have an inflation.
Maybe, but then investors won't invest into the country, capital flight and all of that. That being said, no.one knows what would happen if all the countries decided to do that.
What is happening is that we are stretched, and so we are inclined to negotiate wages even more.
When some companies start raising their prices and then other prices start raising theirs to catch up, there is higher inflation. When some companies raise prices but people buy less and most of their competitors don't follow along, there is lower inflation.