Has any country used inflation as the primary, official way to raise revenue instead of taxes, a la Tezos? (Please don't answer "Weimar Germany". I'm asking for governments where that's the explicit, accepted source of funds rather than a desperate emergency measure)https://twitter.com/FEhrsam/status/949355741160206336 …
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Probably a psychological threshold more than anything. A rate with significant impact on value over time but slow enough that it doesn't cause individual people in the economy to act radically differently/erratically day-to-day
I believe Australia's inflation rate went up to double digits % in the 80s, and that the effect was pretty severe on the population (particularly people with large mortgages).
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Wouldn't high inflation be awesome for people with large mortgages? Their monthly payment stays the same but their income goes up. (Unless they have an ARM.)
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With variable rates loans, I meant. Which was very common at the time, as far as I understand. Apparently it caused a lot of political turmoil.
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We can view inflation as similar to issuing stock options. Mature companies tend to issue 0-3% of outstanding stock. High growth companies can issue much more than that. That's a possibly reason why inflation targeting is around that level in mature economies
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That's a fascinating parallel; hadn't thought of it in those terms.
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Canada, '81, 12.9% annual inflation, mortgage rates over 20%... it was stress alright. Then PM P.E. Trudeau basically charmed Canadians out of a stampede to hyperinflation via wage demands by months of a "6 and 5" campaign.
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