[ylem]

In what sense? In a world of fiat currency, post-Bretton Woods, what does money mean? I am not an expert by any means, but to me, it seems like the USD has value (ignore the rest of the world for a moment) because the US issues taxes that it says can only be paid with this wacky tokens called dollars and if you don't pay your taxes, then bad things happen. The rest follows from there. I think that you are saying (correct me if I'm wrong) that printing money leads to inflation which lowers what you can exchange your tokens for (maybe it takes more of them to buy apples). So, the first question is whether that is actually true. We have seen a fair amount of printing of money in recent years, but fairly low inflation. It's not obvious to me at what point that changes. The second question is whether inflation if it does occur is net bad/good and for who. I think we can agree Weimar Republic style hyperinflation is bad. However, let's say that inflation is 1% is that good or bad? For who? I think this question doesn't have meaning on an absolute scale. I think it has meaning relative to growth (and the productive capability of the full economy). Let's say that the economy is growing at say 6%, but we have 1% inflation--I'm fairly happy with that. But, let's say that we have 2% growth and 1% inflation--I'm less happy. Deflation is deadly (which has historically been the fate of gold based currencies), so we could argue that having a bit of inflation is insurance that we pay to avoid disaster. But, what about beyond that? The typical argument is that it helps drive consumption and encourages investment. Do you disagree?

[LudwigNagasena]

> We have seen a fair amount of printing of money in recent years, but fairly low inflation.

The money weren’t distributed proportionally to the wealth of the people. Another reason, which though applies only in short- and mid-term, there are various nominal rigidities: contracts mostly use nominal values.

> The second question is whether inflation if it does occur is net bad/good and for who.

Well, that’s a whole nother question. You can create inflation using direct deposits to the holders of money.

[webinvest]

It’s getting above my level of expertise but in addition to taxes, mortgages, corporate bonds, and state bonds also play a part.

Also inflation in the range of 1%-3% is considered a good thing because it helps encourage trade and prevents deflation. The amount of interest one can earn in a savings account or CD should also be taken into account.