Defining Dollar Destruction By Units Of Work
Thankfully the destruction of the U.S. dollar is gaining some press. I’m starting to see radio hosts and TV personalities talk about inflation that did not typically talk about it before. Neal Boortz is one of these. Today, he spent several hours talking about monetary policy. He talked about inflation in a great way that I believe makes this concept hit home a little more effectively which is important because inflation is something that the public is way too carefree about. Any way we can make it more real to people, this is a good thing.
Boortz talked at length about how each hour of work that you perform is worth less when inflation is eating away your money. Think about this for a second. You trade your work for money. That money that you are getting is worth less due to inflation. That means that your work is worth less. Now, how do you feel about that?
Some people view inflation as something that only affects rich people because they have a bunch of cash and that cash gets eaten away. This is incredibly false. Rich people are way more insulated against inflation because they typically are hedged against it via various investments. The middle and lower classes are the people that get hit the hardest by inflation because they are spending most of their money on stuff just to get by (food, clothes, gas, etc.). The prices of these necessities will rise in an inflationary environment. Your dollars become worth less; therefore, your work is becoming worth less.
Sadly, it’s become the official economic policy of the developed world that a weak currency is the path to prosperity despite the fact that it’s never worked. Instead of ignoring this policy because we assume that these leaders are smarter than us and they tell us that monetary policy is too complicated for us regular folks, we should start demanding that they implement a strong dollar policy because rising prices are going to devastate average working Americans by the millions. These economists are wrong. We should pursue a strong currency and a sound monetary policy for the long term health of our country and economy.