We have to push back against the political wordsmiths. Using the term inflation to describe this money phenomenon is a sham that favours the money printers. in the past people have used the words strengthening and dilution and I think this is much better.
Inflation implies that what goes in (the money printing) is not material and that the surface is what is of importance. I don't think that this balloon analogy relates to reality. You could say in this image the surface was the market of prices, but the market is influenced of the whole of the money supply.
Deflation also, is such a deflating word, no wonder they picked it, they want it to make you feel sad. The terms have been chosen to maximise the money printers disguise and reduce it's psychological footprint in the publics mind.
In truth, during what we call "deflation" the pool of money becomes more potent. The metaphor of the pool which is a good description, is broken down when the balloon inflation is included. This creates a convenient confusion for the state. The term "Dilution" is more accurate. The pool of money gets bigger and its potency reduces. All of the sudden your brain doesn't hurt so much.
In the pool metaphor inflation money is added to the pool and in doing this the strength of the money is diluted, something that you don't want happening. You can see easily that this disadvantages savers. I think its much clearer, or is it just a boozy metaphor? Let me know
To me the word is dilution not inflation
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