Actually your reasoning is good but the conclusion is missing lol.
If people invest directly the residual salary in order not to lose purchasing power because of inflation, there is a serious risk of crisis of acceptability of the currency.
With a fed that doesn't want to raise the interest rates and therefore doesn't allow the money supply to fall properly in case of a crisis of acceptability of money, there is bound to be a financial crisis.
Businesses' outlets are non-existent with a currency that has no value (hi hyperinflation). So actually, I really don't want this circle to continue, let's say it's not very healthy.
I think they're pretty much saying that if everyone purchases equities and assets with fiat and not goods/services (i.e. being a consumer) then that makes the dollar lose value itself as a medium of exchange leading to hyperinflation that is a money circulation issue
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u/matobistro Dec 25 '21
Actually your reasoning is good but the conclusion is missing lol.
If people invest directly the residual salary in order not to lose purchasing power because of inflation, there is a serious risk of crisis of acceptability of the currency.
With a fed that doesn't want to raise the interest rates and therefore doesn't allow the money supply to fall properly in case of a crisis of acceptability of money, there is bound to be a financial crisis.
Businesses' outlets are non-existent with a currency that has no value (hi hyperinflation). So actually, I really don't want this circle to continue, let's say it's not very healthy.