Oddbean

I wish the nuance was as easy to explain. I work on trying to make it easier to understand, but when people are ignorant of how money even works, how do you then give an explanation that requires them to apply it? I agree that there needs to be an explanation, and the problem is that all you have to do is regurgitate nonsense propaganda we’ve been fed our whole lives to “understand” the other narrative, and nobody asks the question, “well why do people buy it when they bought the other before?” Again the answer is in the money. Here’s an analogy that I use to help picture it, maybe this will help: Imagine you have an honest winemaker, and a dishonest one. The honest winemaker uses high quality ingredients because they care about their product. The dishonest winemaker uses what is the standard. It’s good enough not to raise any eyebrows and he basically labels it the same as his competition. The government prints trillions of dollars, wages take years to adjust to it, but input prices and business costs rise almost immediately. The good winemaker refuses to compromise on the quality of their wine. He has to raise prices by 15% to keep selling a high quality product. The dishonest winemaker has no problem adding fake coloring, some Monsanto flavors, and then watering down the actual wine to keep the price the same. The customers don’t get a 15% pay raise and won’t make up for that difference for a year minimum. Now they are poorer and have to budget on things they never had to before. They see that of the two wines they purchase, one just shot up in price, and the other stayed the consistent. To them, the honest winemaker is a greedy asshole, while the dishonest one looks consistent and reliable. The customer only budgeted for X to spend on wine, not X+15%, so they switch to the dishonest winemaker out of either anger at the honest one, which is doubly driven by the profits of the dishonest one who will gladly repeat the politicians stupid “greedy business” bullshit and pay others to repeat it as well with their higher profit and revenue, or they switch out of simple poverty. The CPI doesn’t account for quality or substance in products, only what customers buy. So CPI comes in at 1% that year, because the quality and ingredients of everything were degraded to make up for a broken, corrupt money. So when people say “it was inflation,” they don’t believe you, because they pay the same amount for wine… The dishonest winemaker gains a massive influx of customers. The honest one goes out of business. And everyone takes the lesson that to value quality over price is a recipe for disaster, and lying is just “a part of doing business.” Do this for 60 years and you can rot the core of any nation on earth.