———and saved some money for their retirement-——
The fallacy is saving. The money should be invested in assets that will rise in value to keep pace with the inflation.
Investing in the American economy via an index fund should preserve the capital and even register real growth. and then there is gold or real estate. All of the above should preserve the relative value after being inflated ,
Not at all. If 'we' did have more of a free market, and not what we have today. Saving would be perfectly fine.
Savers should and would be doing well if the Gov't wasn't the one sponsoring guarantees, loans, and investments. Banks would 'reward' savers with higher interest rates and the such.
As for the advisement of putting funds into index funds, sure, might as well be well rounded. But, since we don't have savers being rewarded; stock investing is fueled because of low interest returns. Thanks Gov't!
Saving is not a fallacy. Government has made saving [intentionally] a foolish activity, but saving, under normal circumstances, is what creates economic growth and rising living standards.