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Hey Leofinance community. I've been wanting to know the answer to this question for a while. I figured that if anybody could provide an answer, it would be the smart folks at Leofinance.io.
Where does inflation from money printing normally go?
To give a little background in this question:
I sometimes trail off in thought and end up deeply pondering random things. One day, for whatever reason, I was struck by the similarities and differences between blockchain governance policies and state governance policies. I thought about how it was kind of interesting that the witnesses on the Hive blockchain (and others) are basically funded by the inflation on the blockchain. The thought occurred to me that I should explore whether or not such a practice would be viable for a state government. Could a government be totally funded by the inflation of its currency?
That line of thinking led me down another rabbit hole. How could I have any frame of reference as to how much more inflation would have to happen to fund the government unless I knew what happened to the inflation being printed now...or at least under normal circumstances? Things might be a little different now because of COVID. I know the US is printing money like crazy. I think at least some of that will go directly to the citizens. I'm not sure how much of a percentage that is though.
So that's where I'm at currently. When the supply of fiat money increases, who gets those new bills? Who are the direct beneficiaries when the money printer goes brrrrrrr?
While you're at it fell free to weigh in on the benefits and advantages of a government operating solely off of the money it printed. Thanks for reading. I look forward to hearing/reading your thoughts.
Posted Using LeoFinance Beta
Good question and one I'm pretty sure the government doesn't want you to know the answer to. In my mind, the only people who are really benefitting from the money printing are the people closest to the printer. For example,
In the meantime, what no one seems to ever put together is the fact that the money sent to the citizens, while helpful, does nothing for the majority of those people overall. For the ones who really need it, it's not enough. And for the ones who don't, the money ends up going into some sort of asset. THAT is where the real inflation lies.
Assets. Commodities, real estate, stock markets, cryptos, hell have you seen what's starting to happen with NFT's?!? These assets continue to skyrocket in price making sure the haves of this world keep getting more while the have nots are using their checks to continue trying to meet day to day expenses. And where does the money they spend end up going? Into the pockets of the corporations that are providing the things they need. And where do you suppose those corporations spend that money? You guessed, making sure these same politicians get reelected. Hmmmm....
What money printing has done is take away the value of the working man/woman's time. While assets continue to inflate, wages do not. While technology continues to improve things benefitting society as a whole, the prices don't go down and the corporations make more money. I'm not saying corporations are evil. Far from it. It's the gov't that continues to feed it's own addiction to power that fosters this environment. They have no acccountability whatsoever and that is on both sides of the aisle. If you ever want to see the two sides come together and unite as one, try and add a third party to the mix. Not saying the Libertarian party doesn't count. Just saying that if they ever threatened to win an election, the other two parties would go full-on attack mode.
Anyway, we've basically reached the point of no return. These economies have indebted themselves to the point where they're never going to be able to pay all the debt back. And so, the Great Reset. Who knows what sort of clusterfuck that will be but...until they get rid of the bankers/politicians being able to print whenever they feel like it, the divide between the top and the bottom will continue to widen.
Posted Using LeoFinance Beta
Typically inflation means the cost of stuff goes up
Yeah, I know, but it also comes from the an increase in supply of money.
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