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I have the feeling that the whole trade war starts from a pile of nonsense.
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Simon:
I was taught at school, not an English school because they don't teach you real world stuff that inflation works like this: Workers demand more pay, so they get more pay but the price of stuff goes up, so the workers want more money to earn enough again, they get it and the price of stuff goes up. Of course there can be tinkering on the side, greedy companies and the types of jobs people do and their value.

We all import stuff from cheaper countries so that is a small contribution to price increases and last time i checked automated assembly machinery doen not get a pay rise or any pay at all. So yea employers will tell you that the more they pay you the more they have to charge and that paying you more will be pointless while they live their luxuory lifestyles......
Simon:

--- Quote from: apis on June 02, 2019, 06:27:23 pm ---Imagine a mini world that only have bread as a commodity. There workers get paid a certain amount which lets them buy enough bread that they stay healthy. Now double the salary of everyone and people will be able to buy twice as much bread, but the amount of bread produced is the same so what happens is that the bread prices double.

If instead only one of the people get doubled salary, that person can buy double the amount of bread, but that is a very small change to the average so the bread prices only go up a tiny amount, but everyone else can buy a little bit less bread.

--- End quote ---

it's not even like that. We don't just trade bread. Money does slowly devalue but wages also devalue. The former is a natural process because of what i explained above but the latter is thu rich making excuses for clawing back more than they need.
apis:
Of course, it's a gross oversimplification, but it illustrates one of the mechanisms at work. You can add more commodities than bread though, and it will still work the same way.

But yeah, it gets very complicated quickly, I'm out of my depth here so don't quote me on it.  :-\


--- Quote from: Simon on June 02, 2019, 06:27:56 pm ---Workers demand more pay, so they get more pay but the price of stuff goes up, so the workers want more money to earn enough again, they get it and the price of stuff goes up.
--- End quote ---
Yes, that sounds right, the prices go up because after the workers get more pay they have more money to buy stuff so sellers can increase the prices and people will still be able to buy the things they need, so in the end they get more money but they can only afford to buy the same amount of goods...
Miti:

--- Quote from: RoGeorge on June 02, 2019, 06:21:42 pm ---*Anything* with an exponential growth is guaranteed to fail in the long term, from cancer, to exploding stars, to economic growth or inflation.

IDK, the world seems crazy.  :-//
 ^-^

--- End quote ---

No one thinks long term in the west. All that matters is this quarter, maybe next quarter bottom line.
Simon:

--- Quote from: Miti on June 02, 2019, 06:43:55 pm ---
--- Quote from: RoGeorge on June 02, 2019, 06:21:42 pm ---*Anything* with an exponential growth is guaranteed to fail in the long term, from cancer, to exploding stars, to economic growth or inflation.

IDK, the world seems crazy.  :-//
 ^-^

--- End quote ---

No one thinks long term in the west. All that matters is this quarter, maybe next quarter bottom line.

--- End quote ---

Exponential growth is not a problem. Money is symbolic and it losses value and the goverment print more money. Wages go up prices go up. The imbalance is in the distribution of the two. it is scewing towards only prices gowing up and these are matters of national statistics.

When I got a 10% payrise I started buying nicer food from a more expensive shop, my excuse was that is was next to lidl but unlike lidl i did not have to que halfway up the shop. I now can no longer afford the expensive food and lidls quality has improved so I have gone back to lidl. Except lidl are now employing less people than they ever did and the other stop is known to treat it's staff very well. When i earn more i help others earn more. When I struggle I have to withdraw my custom and go to companies that pay their staff less. This is what the policy makers do not see.

My employers staffing costs is less than 10%. When the company owner that few have even met decided to give us all £1000 for christmas many did not beleive it until the money was in the bank. Of course because the new rules that apply to those naughty bankers also apply to me I had to pay 33% tax like I was getting a million pound bonus.

We get 2-3% rise every year and frankly if we did not many would probably not feed themselves.
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