The reason a 2% inflation rate is “targeted” is that people don’t seem to notice when you steal their money slowly.
Discussion
A little less than 35 years at a steady 2% rate to lose HALF your purchasing power. You’ll never notice! 
Well said
No because they can only enslave you slowly through debt and credit. Otherwise we will have a revolution
⚡⚡ "Inflation " is a calming and passive sounding word. That and it gradual rate of corrosion is qhat enable many people to simply pretend its not theft.
With a little self reflection, I believe most people will do the work to exit fiat when they wake up.
2% = just the tip.
I only noticed it somewhat recently. Same for lots of folks. Guess it works!
Wait…there’s inflation?
I notice! Always have
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Jeff, I’m in a discussion with my brother. I shared this statement, and he is asking “who is stealing it?” I would say it’s the cantillon effect. What would you say??
Yes, but I find for most people unaware of that effect, it just easier to explain the process and that the other side of the coin on inflation is wage and savings deflation. And then ask - who wins and who loses?
The NAIRU (Non Accelerating Inflation Rate of Unemployment) is one those other crazy ‘targets’ that the policymakers try to meet. In other words, keep a good proportion of people unemployed for fear of inflation. This means having an excess supply of labour (unemployed people) by reducing demand, by guess what, dialing up or down inflation by tinkering with the money supply. We all know how soul-destroying it is for many people to be unemployed. It’s amazing to think that a 5% unemployment rate is ‘ideal’ to stabilize inflation. What a human cost!
It’s ideal for inflation because it keeps wages suppressed, worker mobility limited, and people easier to replace. Puts corporate profits above people’s ability to make ends meat.
Fuck them
F❌ck em
There are theories that Nairu has been decreasing over last decades, closer to some 3ish % range (US).
Hypothesized cause is the decreasing labor matching frictions thanks to the internet job searches, etc.
Evidence was supposed to be the low inflation despite the very low unemployment in 2010s.
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I think the Nauru theory makes sense; agree that the numbers are arbitrary...
What it's missing is the split of the inflation definitions to monetary vs market driven.
Skewing the markets to overcompensate for the monetary inflation we've created is a pretty basic fail of the Macroeconomics class. And total omission of thinking about what causes the current unemployment rate to differ from Nairu in the first place.
Bankers and politicians capitalizing on the government’s ability to issue new debt and print new money win, or are the ones stealing. Uneducated plebs think the politicians are helping them by giving a little of the new money as handouts/entitlements, so politicians get re-elected. The bankers and other govt contractors (I.e. military) get rich and also kick back to politicians. The average person getting a salary or hourly wage doesn’t get any benefit, but instead is hurt.
There's a lot of talk about your post.
Added to the https://member.cash/hot feed
The land of 🐑 picked 2% out of thin air don’t forget…….
https://www.reuters.com/markets/mouse-that-roared-new-zealand-worlds-2-inflation-target-2023-01-30/
2% is the Cantillonaire's golden ratio.
Just like boiling a frog slowly. It’s less likely to notice until it’s too late. We’re the frogs! #bitcoin
BTC held by countries according to Chat GPT-4
1US: 2,816,000 BTC
2China: 2,000,000 BTC
3Russia: 480,000 BTC
4Canada: 243,000 BTC
5UK: 170,000 BTC
6Japan: 90,000 BTC
7Germany: 86,000 BTC
8Netherlands: 29,000 BTC
9South Korea: 20,000 BTC
10Australia: 18,000 BTC
🎯. A 2pct wealth tax on top of everything else. Except it’s not really 2pct but significantly higher. On inflation, I like #[2] ‘s vector based thinking.
Jeff, I am so grateful for your contributions. Not only do I take a lot of value from the knowledge you share, but I’ve realized I also take a lot of hope and joy from your perspective. In these uncertain times I can get a little scared about whether I will be able to afford an optimistic future for myself. When I listen to you speak I feel great peace and positivity. I’ll just keep buying my $200/wk of Bitcoin and I feel like I’ll be okay.
Its quite interesting. I am thinking it is mostly due to the need for stability and then 2% is "hard to notice". It started in New Zealand and spread to other countries. Problem is with definition itself and how it is different for different people - defining it as vector with different baskets by common categories gives better representation, middle class vs billionaires.
Check out bitcoin fundamentals economic masterclass episode for more info: https://m.youtube.com/watch?v=CTA3PKB4PoI
It gets better than that Jeff. Here in Australia, people don’t seem to mind when you steal their money fast. Since Jan 2020, we’ve lost 33% of our dollar’s purchasing power. Yet most people think they got richer!
Home ownership is a big focus in the land down under.
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сейчас люди не замечают и 6% инфляции...
Boil the frog
Digging into the 2% mystery was realy entertaining and revealing (not sure it’s appropriate to share twitter links here lol)
https://twitter.com/linasantlinijos/status/1636035370327441411?s=46&t=lYW9RZjISOhM0maIkPt8AA
Just like the taxes on your paycheck! Slow bleed.🥸
Truth
Something, something, rule of 72, cut by half within two generations (on the high end), something.