Comment on Be nice
Eq0@literature.cafe 3 weeks agoThe assumed reason for inflation, as I understand it, is that on one hand things devalue over time and on the other we build our system around infinite growth and rewarding innovation (many asterisks here…)
During the Middle Ages, neither statements were considered true, the world was considered stagnant and there was virtually no inflation. That was before the banking system - so with 0% inflation i would expect the banks to collapse…
And then… I don’t know! Stuff is hard and economics harder…
Remember_the_tooth@lemmy.world 3 weeks ago
Thanks for the response. You gave me a lot to think about, so I opened the Wikipedia article on fiat money. The part on history was pretty cool:
Link
Eq0@literature.cafe 3 weeks ago
Indeed very interesting. Honestly, it still seems that the reason for inflation is “not backed by real good and something else we don’t quite understand”, in particular considering the examples of bills of credit in North America
Remember_the_tooth@lemmy.world 3 weeks ago
Agreed. Someone else in this thread suggested that population growth was a factor. That was an interesting take. All things being equal, I would have assumed population growth would affect the magnitude of inflation, but not its direction. I think you’re right that there’s definitely some unknowns. I’m not sure I want an advanced degree in economics, but that’s what it might take to understand more.