This is true for investment debt like real estate. If you're taking on debt to pay for basic necessities because salary rises don't match inflation it's an altogether different situation.
Yes, if you take on the debt after the inflation it does you no good.
But if you take loans in 2015 dollars and repay them in 2022 dollars, you are better off in terms of repayment by having a lot of inflation during that period. It doesn't matter what purpose you took the loan for.
One has to maintain those debts in the interim, unless you’re suggesting banks are offering 7 year no payment loans or equally long deferrals. Being able to weather inflation in the rest of one’s life is the problem. I’d love 1000% inflation on the money I use to pay my mortgage, but 1000% inflation at the till would be devastating. For people even mildly leveraged high inflation is painful because everything but their debt gets more expensive. Low inflation helps ease large debt obligations, but even moderate inflation will see tens of thousands of people squeezed too hard causing defaults which creates more homeless people and deaths from treatable conditions. All this said, one can try to time the market by making foreseeable purchases before inflation takes root. It seems that this time has passed for most things, but those who bought houses and cars in 2019 likely saw significant free equity. Without incoming increasing at the pace of inflation people are being slowly forced into poverty by the machinations of the capital class and their stooges.
Right. And the compensation changes associated with going to a different company are almost always better than letting your current company re-evaluate your pay. So if inflation causes people to jump ship to get market-adjusted pay, you now have formerly-productive people now in FNG-mode, which is a much more impactful phenomenon than inflation on its own.
Exactly. Unless of course your income is so high that day to day expenditures are basically a rounding error. Then you can profit handsomely from other people's misery. The rich get richer, the poor get poorer is particularly true during times of high inflation (so long as not catastrophic).
