The dollar is a negative thing. It only exists as a comparison to two tangible things. It's only worth something if two people agree to use it to trade assets. This is why the FED took down gold and the bit coin. This would be obvious to the third string goalie on the St. Petersberg Panthers.
What we call "inflation" is acutally just the disappearance of negativity. When dollars disappear, it takes more pf the old ones to buy new stuff. Ecomomists don't see this because they are mathmaticians. They see a dollar as a "1" and not as a negative thing.
Every day dollars are disappearing. When China buys Iron Ore from Australia in yuan, dollars disappear. When people trade things for things, dollars disappear. They are a medium and like any medium, ghosts, data on the internet, yada yada, they are a fiction.
if the dollar continues to decay exponentially at 3.5% per year, it will be worthless on precisely the same day you say something worth reading. if you can't get a job, at least go to the library and learn something!
Let's say we raise interest rates, the price of the dollar. Would the value of the dollar increase or decrease? It says here that inflation is running at 3.5% a year. Would it be better if we had deflation? Not necessarily at 3.5 but at least at a positive number? In response to Stockman's analysis, Krugman jumped to the subject of raising interest rates, something Stockman didn't seem to mention in the quote from the discussion I saw. Was that jump a non sequitur? Was it a straw man? Or was Krugman simply pointing to the logical relationship between the problem Stockman had identified and the policy response necessary to address it? If so, is raising interest rates the right policy choice now? Doe it make sense to make money more expensive to borrow in an economy that's struggling? Does, in fact, the fear of higher interest rates down the road play a larger role in business decisions as to whether to expand, than problems related to deficit spending?
It's only worth something if two people agree to use it to trade assets.
Well, you can also burn them to keep warm. Should money have another use besides as a medium of exchange? Does the fact that gold can be used to fill teeth, or as jewelry make it a better form of currency?