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Of course inflation benefits debtors. Duh. A huge part of the reason that governments favor inflationary monetary policy is that inflation favors debtors, and government is always the largest debtor in society. This does not make it good, or magically make its deleterious effects vanish. [/ QUOTE ] This is not really true and slightly disingenuous. Sure, the government is the largest debtor, but it is not the majority debtor by any means. It's not even close, with the federal debt being only slightly larger than 1/6th the total. According to the evil Federal Reserve, total domestic nonfinancial debt as of Q1 2007 breaks down this way: Total: $29.26 trillion Households: $12.94 trillion Corporations: $5.85 trillion Non-corporate businesses: $3.16 trillion Farms: $0.22 trillion State and local governments: $2.06 trillion Federal government: $5.04 trillion I promise to respond to your other post later, but it's going to take awhile and I have work to do. |
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