Inflation is a fake solution designed to make it appear that the economy is growing while it robs thrifty people of their savings. I have a theory that there are three phases of government finance. In the first phase, government finances its operations by taxing the present. When it has exhausted all current taxing options, it turns to taxing the future by borrowing. When it runs out of borrowing options, it taxes the past by inflating its currency. After that, collapse, I am afraid. (If the government refuses to modify its out of control spending practices).
This is true, and I disagree with Klugman. However, I can understand the thought process of inflation being good with regard to the housing market. If inflation were to increase, the under water mortgages get turned right side up in a shorter period of time, ultimately creating "equity". Whether solving the housing/mortgage issues result in a benefit to the economy is a whole other discussion.
This is true, and I disagree with Klugman. However, I can understand the thought process of inflation being good with regard to the housing market. If inflation were to increase, the under water mortgages get turned right side up in a shorter period of time, ultimately creating "equity". Whether solving the housing/mortgage issues result in a benefit to the economy is a whole other discussion.