<p>From an individual view, depends on if you're a net lender or borrower. If there is an unexpected increase in inflation and I'm a net borrower, then I pay the same nominal amount but effectively less than initially agreed upon (i.e. Less real dollars). The opposite if I'm a net lender.</p>

CC BY-SA 3.0
2016-03-22T02:33:48.790Z
2016-03-22T02:33:48.790Z
manofbear
<p>I was reading that the Spanish received so much gold from their occupation of the Americas, that they had a steep rise in inflation. This caused a rapid increase in investment, as the rich felt that they could no longer just sit on their money and had the effect of rising the demand for labor which created one of the strongest middle classes that had ever been seen.
I always hear that inflation is bad, but is it really? It seems like we need inflation to spur investment and growth.</p>

CC BY-SA 3.0
2016-03-19T11:01:40.273Z
Most central banks will strive for moderate inflation (2%) because of fear of deflation. Deflation and inflation aren't inherently evil as long as they are kept at a controllable level. The difference between the Spanish Empire and the British Empire was that the Spaniards looted riches, but didn't have enough real value at home to invest it in, thus triggering inflation. The British controlled foreign countries but traded with them instead, which significantly increased the flow of new goods and increased wealth in Britain. Inflation is essentially "too much money chasing too few goods".
P A N
<inflation>
Is inflation good?
Marc Perry
# Is inflation good?

(Asked by: username_0 on 2016-03-18)

I was reading that the Spanish received so much gold from their occupation of the Americas, that they had a steep rise in inflation. This caused a rapid increase in investment, as the rich felt that they could no longer just sit on their money and had the effect of rising the demand for labor which created one of the strongest middle classes that had ever been seen.
I always hear that inflation is bad, but is it really? It seems like we need inflation to spur investment and growth.

**Tags:** inflation

> **Comments:**
> **username_1**: Most central banks will strive for moderate inflation (2%) because of fear of deflation. Deflation and inflation aren't inherently evil as long as they are kept at a controllable level. The difference between the Spanish Empire and the British Empire was that the Spaniards looted riches, but didn't have enough real value at home to invest it in, thus triggering inflation. The British controlled foreign countries but traded with them instead, which significantly increased the flow of new goods and increased wealth in Britain. Inflation is essentially "too much money chasing too few goods".  

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## 1 answers

### Answer by username_2 on 2016-03-22. Score: 2 | Accepted answer

From an individual view, depends on if you're a net lender or borrower. If there is an unexpected increase in inflation and I'm a net borrower, then I pay the same nominal amount but effectively less than initially agreed upon (i.e. Less real dollars). The opposite if I'm a net lender.


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