Inflation?

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inflation

So, what will they do? I fear they will resort to an age-old favourite of monarchs in a fiscal tight-spot and debauch the currency. Because the outstanding balance of a loan does not inflate with the currency, inflation decreases the value of debts. That is good news for debtors and bad news for creditors. Inflation raids the wealth of savers and gives it to borrowers. When the government is heavily indebted, and has no fiscal room-for-manoeuvre, the chance of inflation must be high.

– Jamie Whyte, 'Inflation is likely – but not because of current monetary policy' Telegraph.co.uk

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