• DieguiTux8623
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    1 year ago

    So we should expect more interest raises to efficiently transfer money from the poor to the wealthy… ehm… keep inflation at bay…

    • JasSmith@kbin.social
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      1 year ago

      High interest rates and inflation hurt people with money and help people with debt. As interest rates rise, the value of assets decreases. The inverse relationship is strong and well tested. Debt, on the other hand, loses value with inflation. Inflation paid off 20% of my mortgage over the last few years.

      No one likes high inflation. It’s definitely not a scheme to transfer wealth. That’s the status quo with 2% inflation and cheap debt for the wealthy to use.