What Is The Real Meaning Of Inflation?
This report aims at answering the above question. There are innumerable ways in which inflation occurs in society. Some forms of inflation are extreme while others are not. Or, like corruption in some societies, it appears normal.
Some people think that if you want to know what inflation is you would have to ask Alan Greenspan, or do the measurement of the GNP, the money supply, and productivity. But, had you asked Alan Greenspan what inflation is you would have gotten a muddled answer anyway. The truth is easier to understand.
If you really want to know what inflation is you would have to ask Bernard Madoff, because he was so good at it, or at least seemed to be.
That is because so many people think inflations has to do with the value of money, and it does not. I mean people think they have to ask an Alan Greenspan “What is Inflation?” when they actually know already the value of money, especially when it is lacking!
Money can be symbolic. It can be useful. It can make a difference in your life when you have it and when you don’t. The lack of it means you can not pay your bills. A plentiful supply of it might mean you can enjoy life more abundantly. But money is not the real measure of inflation.
The real measure of inflation is found in the value of the goods you buy or sell. It could be the bottle of water, the groceries, the utilities you pay to keep on the heat and lights working in your house. It could be the house itself depending on how well the carpenters performed the contract to build it. The real measure of inflation is indeed in the value of the products. Let me give you a simple example.
– You go to the store to buy your groceries. Right?
You get the point? It is that most people like you and I understand what inflation really is. So, we do not have to ask an expert “What is inflation?” In society, if people ran around selling rotten apples, or cheating their fellow citizens at every turn when they visited the marketplace to buy goods and services, the activity of cheating - or selling goods and services fraudulently - would devalue the money we paid for them. So it is not the money actually that is inflated, but the value of the products and services that is deflated and causes the problem.
In conclusion, inflation is related to products: the value of goods and services themselves. It is, perhaps, a measure of their value. Or, more importantly, it is the measure of the cooperativeness of an economy. The more a society cooperates by providing valuable goods and services, the more an economy thrives. Individuals get what they had paid for… When someone says the dollar was ‘devalued’
Now the measure of the cooperativeness of a society can be seen in the activity of individuals who deliver goods and services. If the individuals always cheat and steal, they do not provide goods and services of any value… The money becomes ‘inflated’
As a society, we are on the brink of losing our freedoms. Why? Well, no one lies, cheats, or steals in society like groups. Sure individuals do, but no one does it better than governments. We are on the brink of economic collapse in health care, banking, automobiles, and other major areas of the economy as the government begins to monopolize production. When that happens the lying, cheating, and stealing will grow. It will be less a government for and by the people, and more one that serves lobbyists and special interest groups who typically skim from the top their profits like cream from a bottle of milk. Pretty soon we will only be able to purchase ‘blue milk’.
Rolfe H. Green
Computer Consulting Network
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