What is Inflation?

Central Banks use a term called Quantitive Easing to describe the practice of “printing money out of fresh air” if anyone else tried to do that they would go straight to jail. This creates price Inflation. Where over time the price of things you need to buy goes up.

Not only does the price increase, look at the weight. Inflation makes things smaller over time too. Including your bank balance.

Inflation is good for Government’s because it makes them look like they are doing a great job with the economy. Like everything in today’s society the detail is hidden in the definition of terms. They like to change the meaning of words in order to obfuscate the full extent of the damage they cause. Always read the small print.

Inflation traditionally has been seen as a positive for society. However this is pure spin The reason they like inflation is because it forces people to spend their money before it loses value. Imagine in an hyper inflated economy that the wages you earnt today could not buy you your food tomorrow? that is the price of inflation. Told in that way does not sound positive at all.

The government uses a tired or false metric to calculate inflation. It’s called the CPI (consumer price index) it tracks the prices of those daily items we buy such as Bread, Milk etc.

According to Investopedia

ever notice why the things you need go up in multiples against the things you don’t need to live.

“CPI is an economic indicator. It is the most widely used measure of inflation and, by proxy, of the effectiveness of the government’s economic policy. The CPI gives the government, businesses, and citizens an idea about prices changes in the economy, and can act as a guide in order to make informed decisions about the economy. “

Notice the word “informed” that’s where this debate centres itself. If you don’t include the cost of housing, medicine, energy and beef into this measurement. Then how can it be informed? these numbers have been manipulated for years by successive governments.

Bitcoin uses the opposite approach Quantitive Hardening which means you have to exchange electrical energy in order to create the new currency & secure the network. Anyone can do this using a special computer called an ASIC. This is known as unforgeable costliness.

The Bitcoin network is the largest distributed computer network in the world. It’s scarcity creates price deflation which means the cost of goods goes down over time. (As illustrated above with the price of the iPhone measured in £ & Bitcoin.)

Why your £ cash pension will be worthless when you retire.

This chart shows the moeny supply or £ printed in the UK over the last 2 years.
Inflation at 2% huh? Well this is what happens over 50 years to the money you work so hard to earn. It’s purchase power dilutes.

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  • What is Bitcoin? – BitcoinEssex :

    […] Bitcoin as an insurance policy against an incessant “print your way out of trouble” policy of Quantitive Easing. This policy continues today under the guise of […]

    3 months ago

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