I’m no economist, but I increasingly question whether raising interest rates to fight inflation really scales into these extreme values.
I mean, sure, if you have a 10% inflation and want it at 2% then raising rates reduces the money supply to cool an overheating economy, makes sense. But if your inflation is 60%+, that’s not because there’s too much debt-fueled enterpreneurship and discretionary consumption going on, it’s because the people lost faith in the currency, the economy and the governement.
How does turning yourself into a country where taking a loan will fucking kill you help restore people’s faith in the above? Someone explain this to me.
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The mortgage holders must be so happy about this.
I’m no economist, but I increasingly question whether raising interest rates to fight inflation really scales into these extreme values.
I mean, sure, if you have a 10% inflation and want it at 2% then raising rates reduces the money supply to cool an overheating economy, makes sense. But if your inflation is 60%+, that’s not because there’s too much debt-fueled enterpreneurship and discretionary consumption going on, it’s because the people lost faith in the currency, the economy and the governement.
How does turning yourself into a country where taking a loan will fucking kill you help restore people’s faith in the above? Someone explain this to me.
So, can we open savings accounts there?
Erdonomics succes story💪🏻💪🏻