To say that any inflation isn't a problem, or that the government doesn't promote inflation is to call the sky red.
Even that mere 1% erodes the value of money and the real cost of lending by quite a bit.
There's absolutely no reason for it, at all. Except, as Widgetry said, the government can print money at full value (although it shies away from doing this too much now), and because an ever increasing money supply tends to keep recessions smaller because people think.
The cause of inflation can hardly be attributed simply to people wanting to be paid more. Were that the case, inflation would be a good thing because workers would get paid more BEFORE prices rise.
Inflation is something that can easily be prevented, too. I'll believe an economics professor who says that (read "Economics for dummies") before anyone else, because the government can print just enough to keep up with the growing market to not cause deflation.
One of the biggest pains is that while purchasing power may remain the same (wage increases matching inflation rates), the purchasing power you have stored in the bank will have decreased (which is why I advocate people to put their money in money-market funds, something I myself need to do)
Is it a inflation in kapiworlds?
Moderator: moderators
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Guest
No, there is any inflation, there is speculation. I spend a lot of money in R&D, I would like others to pay more attention on it.Is it a inflation in kapiworlds?
When I see some huge companies which large amount of cash plummeting the market, I am furious because that delaying my growth. So, I buy their products and make my margin. Secondly, I force myself to negociate direct contract with others companies, it is less expensive for both parts.
I sell them at low price, but they have pay the quality of my goods. On the market, i am speculating.
My ROI is too low with my production, there aren't many ways to make profitable businesses. I consider the market as a stock exchange. My ROI is arround 60% and I spend my cash for my production extension in order to decrease my cost by direct contract.
Last 3 days, I lowered my production by 30% via direct contract.
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Guest
this is just me speculating, but I think we don't get inflation in kapilands because of a few things: R&D, people spending money making products and buying buildings, alot of people buing steel atm from the steel NPC, market fee, shipping fee, and forwarding fee. probly a few other things like that. All of those things use money that isn't actuly going to anyone who can spend it again. I mean, my company is a virtual black hole of money. I produce everything I use, all the way down to the basics, and use all of my money to expand buildings and reasearch stuff. thusly, anyone who buys my products is puting that money off the market. it's going into a black hole, to never return. that's not entirly true as i do somtimes buy stuff from the market, and plan to start trading for coins at some point, but that doesn't negate my point. money may come in from shops and coins, but lot's also goes Out from the things i mentioned. this sort of thing can't happen in the real world, but it can and has in kapiland.
