tag:blogger.com,1999:blog-2098432983500045934.post389789677036951576..comments2024-03-12T22:19:32.339-04:00Comments on The New Arthurian Economics: But the minimum loss to inflation is like 30%. Isn't that high?The Arthurianhttp://www.blogger.com/profile/16501331051089400601noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-2098432983500045934.post-64717735976492935112015-04-04T05:16:41.039-04:002015-04-04T05:16:41.039-04:00The loss due to inflation in any one year is 2% or...The loss due to inflation <i>in any one year</i> is 2% or whatever the inflation rate was, or close. (Before coffee, I think the loss would be<br /> (1 - 100/102)<br />for 2% inflation. So, close to 2%)<br /><br />So if 'nominal' on the graph is, say, 30% less than the 'real', I think it means that there is a substantial backlog of debt from prior years, for which the loss due to inflation has already accumulated to maybe 28%. Then the current year's 2% increases the loss to 30%.<br />I'm never comfortable when I have to try to "talk through" some arithmetic; it means the arithmetic isn't obvious. But I think this explanation makes sense.<br />The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.com