Matthew 24:42 – “Watch therefore: for ye know not what hour your Lord Yahweh doth come”
Top 3 Reasons: Prices To Rise While Supply Decrease
Inflation is the sustained rise in the prices of goods across the board. Top 3 reasons you can now vouch that prices will rise on a permanent scale while supply will decrease.
Inflation is caused by excess demand: the demand for goods exceeds the supply, causing prices to rise.
In an economy without money, there is simply no inflation. So, you can see: Inflation has something to do with money.
An increase in the money supply leads to an increase in goods prices.
The prices of goods will be higher compared to a situation where the money supply has not been expanded.
Inflation is associated with rising prices be it in the form of consumer goods prices and/or asset prices such as stocks and real estate.
It is the excessive monetary overhang that is responsible for goods price inflation. If you take it away, then there would be no continued increase in all goods prices.
We know that inflation means a loss of purchasing power of money.
When there is inflation, you get fewer and fewer goods in exchange for your money.
Conclusion
Central banks do not preserve the purchasing power of money over time. They deliberately reduce it!
They are not currency guardians but currency destroyers.
An inflation of 2 percent may seem small.
But over time, it leads to a considerable reduction in the purchasing power of money.
Hyperinflation starts when the rate of increase in the price of goods is very, very high and continues to increase over time. Picture a horse galloping faster and faster!
Most modern economics textbooks state that hyperinflation occurs when prices increase by 50 percent or more per month.
However, be aware that a price increase of 50 percent per month implies an annual inflation rate of almost 12,900 percent. That’s frighteningly high.
It would mean, for example, that the price of a cup of coffee would increase from $3 to $390 within a year.
Hyperinflation is usually triggered for political reasons.
People see the scam and realize they have been tricked by surprise inflation.
As a result, they adjust their wage, rental, and loan contracts by renegotiating them based on higher inflation expectations.
Silver and gold is sound money believe it or not!
It cannot be overlooked that inflation has already turned into high inflation.
Looking at it this way, one can say that high inflation is here to stay.
Hyperinflation may not be at our doorstep just yet, but it is getting closer to our house every day.
DISCLAIMER: I am not a financial adviser. This site is for educational purposes only. It is imperative that you do your own research. I am sharing my opinion from personal research and experience with no guarantee of gains or losses on investments, finance etc.
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