Inflation also has positives
Media coverage has been irresponsible
Amid the hysteria about inflation, its easy to miss the fact that it's not just a source of suffering for people. There are in fact winners when there is inflation. The big ones being people with debts.
As an example lets say you took out a loan at a fixed 5% interest rate, but now inflation is at 9%. This means the real interest rate you're paying back is approximately -4%. You're paying back the loan with money that's worth less. Even after inflation comes down the benefits remain because you're still paying back the loan with lower value money.
This is a huge long term boom for homeowners. You can expect the value of your home to go up but your debt won't. This sure beats the alternative: if there was deflation the value of your home would go down and your debt would become costlier.
This is not just a benefit for homeowners, anyone with a fixed interest rate debt will benefit, whether that be a car loan or a federal student loan. There are other benefits to inflation, but I'm not going to get into the Mundell-Tobin Effect because that would be a bit too wonky.
Here is a counter-factual observation: if Donald Trump was still president, you would already know this. That's because Fox News and their ilk would make sure everyone and their dog knew about the amazing positive effects of high inflation. While they were at it, they'd probably tell you about how unemployment is at a 48 year low. But he's not the president, so they don't. That's fine, I don't expect Fox News to do Joe Biden any favors.
Here's my big question though: Why don't you ever hear about any of this from other news organizations?
I avoid TV news as a rule, but whenever I'm exposed to it lately the coverage comes off like this: "Inflation is high! Look at these high gas prices! Inflation is at a 40 year high! Let's check the gas prices again... still high!" I wince in pain when I hear someone blame the stimulus checks from two years ago for inflation today--did other people around the world get those checks too? Oh, and there's this vile take:
Look, I'm not saying inflation is all positive, there are definitely negatives. Nor am I saying that we shouldn't make an effort to reduce inflation, we should. Going slightly off topic, a bill that would have helped address inflation was just tanked by 50 Republicans and 1 Democrat. I'm saying there are positives too, but news coverage never touches on them.
I'm going to double down and take an unpopular stance: Gasoline has long been too cheap and I don't want the price to come down. Our reliance on fossil fuels is killing the Earth and we're never going to kick the habit as long as petrol remains cheap.
That's easy for you to say, but working class people can't afford to buy a Tesla! Don't you care about the working class?
Thank you for that point strawman. I do care about the working class (for the record, I cannot afford a Tesla myself). That's why I want stronger worker's rights and a higher minimum wage. That's why I want universal healthcare that is free at the point of service. That's why I want housing treated like a human need instead of an investment opportunity.
These are all much better ways to help average Americans than focusing on gasoline prices. Cheap oil mainly benefits corporations and private-jet owners with some fringe benefits for the working class that also own cars. Also, this:
Appreciate what you do get out of inflation. Stop praying for cheap gas. If you are struggling with the effects of inflation, here are some tips on handling it.