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$60 Games Are Here To Stay
Next Generation explores the price jump for 'next generation' titles, looking into the success of the $60 price point for videogames. They have a copious number of graphs and charts to support their findings: "Even without Guitar Hero II, prices in 2007 are still at historically high levels. In January, fully four of the top 10 games sold for $60 or more. In February, that jumped to five $60 games, and the average rose accordingly. While there were four $60 games in March, they shared the top 10 with two Nintendo DS games which brought the average down sharply. This happened again in March -- the month of Pokemon -- and also in May."
Wii games are $50 US, $60 games are not here to stay.
Inflation and rising development costs result in both a higher price tag and acceptance of a higher price tag. News at 11.
Prices don't go up because people are "greedy," prices go up because your government decides every day to ruin the value of your money.
Games now have many international ties (design, programming, etc). Because the U.S. dollar is being inflated as fast as it is (and has been since 1913), more dollars means that the dollars out there are worth less, especially versus foreign currencies. This means that prices seem to cost most.
The flipside of inflation is that some people, especially the banking elite, get the new money earlier than others -- so it is usually the middle and lower classes who are harmed with prices inflating faster than their wages do. Eventually wages DO increase because of the easy money out there, but usually it is too little, too late.
Prices go up in any inflationary market. Prices also go up because of a limited supply for a highly-demanded item. Generally, though, in a market with a currency backed by something other than fiat/force, prices go down slowly -- soft deflation. The benefit of this is that you actually can SAVE your money and earn value on it, unlike today where even the stock market gains don't keep up with the TRUE cost of inflation.
Sidenote: Government inflation figures are lies, plain and simple. Find some old credit card statements and see what inflation really is in your life. You may be surprised that it is 10-12% annually for the past 3-4 years.
$20 games that were $60 games last year here to stay too.
If moderation could change anything, it would be illegal.
....modchip sales are brisk.
$50 in 1988 is equivalent to $88 now. Prices are dropping in real terms. (http://data.bls.gov/cgi-bin/cpicalc.pl)
... games cost $90 and we had to play them on the Sega Saturn.
$60 games are here to stay New. If you need your fix RFN, go for it. Me, I'll wait until I can pick 'em up at my local used game store on the cheap, though that's assuming I ever get a next-gen console in the first place - the best part about the PS3 coming out was the way the prices of PS2 games sunk through the floor. I'm gettin' a lot of milage out of that.
--Triv
I modded the firmware in my 360. True, I don't have Live access anymore...then again, considering I have burned roughly 20 games, I have saved about $1200...I think I will go buy a core system and spend a hundred bucks on Ebay to buy used version of the games I want on live...I've saved enough to make the purchase warrented.
Still. I refuse to pay 60 dollars for a game (unless it is something like Bioshock or Mass Effect or Fable 2...I intend to purchase those.)
Am I a criminal? Perhaps. Is what I'm doing morally wrong and illegal? Perhaps. Do I give a fuck? no.
Living With a Nerd
Or we could go further back (SNES/Genesis) era and look at all of the $60+ games then.
Hell, look at the prices for N64 games. They generally retailed for $60 new. CD based games brought the price down to $50 (new) for two generations. The better margin on distribution medium made its way into production value for games. Now development costs have finally eaten all of the margin we've gained from switching mediums and prices for games have gone up.
As for why video games (and attendant hardware) haven't really been affected by inflation throughout the years (consoles generally debut at $300-$400) is all thanks to Moore's Law. Prices were coming down as fast as the value of the dollar.
This is also why the PS3 is more expensive. Nintendo, and to some extent Microsoft, are leveraging Moore's Law to keep hardware prices at some level. Sony decided to go balls to the wall.
My twitter
Man, enough already. You've been posting this gold-standard bullshit for years, and it's never made any sense. You have no credible sources for any of this. Give it up.
You've also posted a lot of mystical pseudoscience babble about gold. It's just a metal. Inasmuch as it has little to no innate utility to anyone, it's a substitute for actual goods of value in the same way that paper money is, or any other currency standard.
more dollars means that the dollars out there are worth less, especially versus foreign currencies.
Except for the obvious logical fallacy that foreign currencies have also abandoned the gold standard?
prices go up because your government decides every day to ruin the value of your money.
That was the only interesting thing you mentioned. Yes, money you hoard devalues at a long term average of about 4% per year. And that's a good thing - it's better for the economy to have money actively invested rather than sitting in a mattress. You'll note that time periods with low or negative inflation were times of currency crisis - because the wealthy hoarded their money and little was left in circulation to sustain the economy.
Due to circumstances beyond my control, I am master of my fate and captain of my soul.
Fixed ;)
Deflation is just as bad for an economy, possibly even worse, than inflation, because when you have deflation there's much less incentive to invest money instead of hoarding it.
So untrue. Deflation is fine -- if you sit on your money, it doesn't become worthless. But this also gives you reason to invest properly and wisely, to get a better return than just what the deflation offers. Right now, easy credit and easy money have created all the bubbles we've experienced since 1913, including the Great Depression. All these bubbles followed by recession/depression happen because new money is printed, people spend it/invest it, causing prices to rise, giving people the idea that the investment was a good idea because "prices always go up." Eventually, people start buying MORE than they need to speculate (see, dotcom, housing bubble, etc). When there are no new speculators to sell to, the bubble pops, leaving the late buyers holding the bag. Inflation is the worst thing about economic stability ever. It has destroyed empires for thousands of years.
Soft deflation hurts no one because you don't HAVE to invest to get a return on your money. You CAN, but you'll be safer know your investment is safe from the bubble-markets we're familiar with today. Inflation also steals from the poor, who don't have enough money to save to invest. In a slow deflation market, the poor are helped the most -- they can actually save, in hopes of investing in themselves in the future. The poor can't do that today.
Prices should fall over time, unless there is a supply shortage of something. This is good for everyone.
I pirate games because there's nothing like the smell of black powder wafting across your forecastle after you've laid a broadside into an EA Game heavy with gold doubloons from the Spanish main. Aaarrrr!
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
If what you're saying is true:
Fantastic questions, by the way.
1) Why don't bond purchasers demand a higher premium (interest rate) for loaning money that's going to depreciate that fast -- and they *have* noticed that the government inflates the money supply by now.
Mostly because past history has shown that major losses have been covered by the government through future taxes. Also, we have an entity in the U.S. called the Plunge Protection Team which uses U.S. owned assets to buy stocks ands bonds to prevent market crashes. This intervention can't last forever -- they don't have unlimited access to real assets (gold, land, etc). The PPT has been trying to keep housing funds afloat, along with U.S. manufacturers. They're slowly losing that battle, and the market will be terribly harmed.
Look at Bear Stearns' recent bond report. One bond is now worth $0 on the dollar (yes, $0 on the dollar, their official statement). Another bond is now worth 9 cents on the dollar. These are billion dollar bonds, now worthless. Yet many of these bond issues are diversified through CDOs, which are increasingly becoming dangerous. We're talking possibly $1 trillion in CDOs that are in danger of collapse - yet the average person has no clue about it. Things could go from bad to horrific in very short order, affecting markets unrelated to the bond issues quickly.
Over time, if the government DOESN'T intervene and bail-out the investments, then bond investors WILL demand a higher return or some sort of reserve to back up the bond. We'll see if that happens. I just checked the city and state bond issues, and some states have unfunded liabilities of over $100 billion coming up (see Florida). It's bad, really bad. They'll issue bonds based on future tax income, but they'll have to raise taxes to meet those liabilities.
2) Name the basket of commoditiy futures I can buy that predictably appreciates at the "true" 10-12% inflation rate you claim.
Impossible because inflationary income causes people to invest unwisely, so inflation moves from market to market. When a bubble pops, those who pulled profits out before the crash will still have all that money -- but they will take time to reinvest it to create another bubble they can profit from. How many people lost their rears in the housing crash in the 90s? All those profits taken out before the crash created the dotcom bubble -- plus new money from Greenspan's inflationary printing cycle. That crashed, hurting hundreds of thousands of late comers, but the profits that were taken out (including all that newly printed money) still existed in someone's pocket -- someone who invested in home builders and land. As that money flooded housing, and the new money that Bernanke created came in too, housing went crazy. Housing is crashing now massively, but the early profit takers got out with billions, if not trillions. That money still exists, and it is now flooding into the stock market -- causing new bubbles waiting to burst.
I know a lot of friends, family and customers who are rallying on the stock market, not realizing that many companies that are growing in dollar price are NOT profitable -- it is just old and new money flooding into the market to create a new bubble. Those who exit early will make a ton of profit, but they'll leave the bag held by all the suckers who saw all that money and figured they could get rich, too.
The rich get richers, the poor and middle class get poorer -- thanks to inflation.
Apology to Ubuntu forum.
Actually I just bought a Greatest Hits title for the 360 yesterday. $30. So yes, they do exist.
The expression is "I could NOT care less." Think about it.
Xbox 360 Platinum Hits
The boom-bust cycle is nothing new, and not a product of inflation. Inflation is part of the boom-bust cycle.
As for the printing of new money being the cause of today's inflation, that's false. The increasing money supply today is dominated by credit offerings, not by currency.
As for deflation being bad for the economy, I'll agree with you. There were a couple studies recently released indicating that recessions rarely follow deflationary cycles. Then again, it's not surprising -- what follows a deflationary cycle is a recovery, typically.
However, all else said, I'll go out on a limb and say that over time, the boom-bust cycle is healthy. It promotes advancement during boom cycles, then weeds out the weak during bust cycles. In the long run, the boom-bust cycle promotes technological advances that result in increased standard-of-living across the board. The key is to mitigate the bust cycles so that the economy doesn't collapse.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
Are You F**KING NUTS?
The dot com bubble happened because of INFLATION? The dot com bubble made Many Many Many people wealthy, and kept the economy going for quite a few years. Then the charlatans became too common and the economy corrected. Inflation had ZERO to do with it. Over eager investment in stupid ideas is why the bubble burst.
House is the exact same thing. Stupid investors bought bad investments because they thought they could. Good for the sellers. Good for for me who fixed up and flipped two houses and then got the hell out of the market. For a while the cheap money helped a lot of people. Then people got stupid and it had to stop. That has absolutely nothing to do with inflation. That has to do with human nature and emotional purchasing.
A boom/bust cycle is NORMAL and HEALTHY. Every thing in the world is cyclical. If you have no cycle, you have no growth period and no correction period. If there is no cycle, the economy becomes stagnant and unless you already have money there is no way to earn good money. Sitting on my cash in the hopes that deflation will cause its value to grow slowly is a great plan to avoid risk and an even better plan to avoid reward.
In a cyclic economy the bulls make money, the bears can make money and the pigs get slaughtered.
In a flat non-boom/bust economy only the pigs who already have money can make money and anyone who wants to make money either through working hard or through buying smart has no opportunity to do either.
Don't be a dogma-quoter. Use your brain about what caused something to happen.
Sid Meier, be that you???
-Rob
Biblical fiscal responsibility
The standard economist line is not that inflation is good, nor that is bad, it is just inflation.
If I give you 1 dollar and want my value back at the end of the year with 4% inflation, then I need 1.04(I'd probably want some sort of a return for depriving myself of the use of the dollar, but for simplicity we can leave that out).
If actual inflation is 5%, I lost value, because to get my value back I should get 1.05, so if inflation goes up, the receiver of a loan wins.
If actual inflation is 3%, I gained value, because I really only needed to get 1.03, so if inflation goes down, the lender of a loan wins.
Inflation is bad because it makes it hard for 2 parties to agree on a mutually beneficial exchange when uncertainty is introduced like this. They can plan on an equal exchange, and then inflation risk can fuck it up.
Deflation is the same, it's just smaller numbers but the same effect. If the value is dropping at unpredictable rates, it stunts business because the 2 parties can't depend on a fair exchange. The information of knowing it will be stable is important to efficient resource distribution and investment in an economy.
So what is important is not inflation or deflation, what is important is how much variance is in the inflation or deflation.
Inflation makes the number bigger, deflation makes it smaller. But as long as the percentage of change is steady and predictable, it has no effect on the exchange in value. However, large inflation numbers tend to carry more variance, while low numbers are more stable. So that's the job of the Fed. To fight inflation so that business people can do their thing without worrying about instability fucking up the exchange they're negotiating.
Some say some small inflation is good, because it keeps pace with the growth of actual value in the country. GDP(just one of several measurements of a nation's value) for example, for the U.S it's been growing around 2-4%, so to keep the right amount of money flowing to represent this increase of gross domestic product, the idea is to keep the amount of money growing at 2-4%. Not everyone agrees with this, I don't see maintaining the speed of money circulation(How fast 1 dollar circulates) is worth intentionally keeping a level of inflation(Wouldn't the value of money change appropriately to adjust for changes in the speed of money circulation?)
However, a gold standard is just a different form of currency. Now a nation's currency growth rate is tied to...mining rocks? The currency itself is worthless, it's the value behind the currency that matters. A gold standard wouldn't help combat this fluctuation, it just ties it to a different fluctuation, mining. The real goal here is to keep the value stable, which is what the fed should do. They're trying to keep it steady at the current value, which is fine if they can pull it off. I'd be happier if they kept it steady at 0% inflation.
The more pressing issue is trade deficit. Inflation should be moderated by the Fed as it is currently. I don't like the idea of upsetting this tender balance. As much as I agree with many of Ron Paul's stances, abolishing the Fed for a gold standard is a dealbreaker since I believe it would bring little good to the country, while potentially wreaking catastrophic results. Another global Great Depression sort of catastrophe.
My explanation is rough, I know, but hopefully someone else can clarify this better than I.
You conveniently leave out the causes of the depressions and bubbles that occurred prior to the great depression (hint: speculation does not require fiat currency to occur).
No, I didn't. The Federal Reserve went on a massive inflationary credit/money creation spree from 1924 to 1929. This easy money gave everyone, even the shoe shiners, a huge increase in the value of the stock markets. But it was that easy money that made the stock markets rise, not actual increased profitability of companies invested. In 1924, a few early investors had early access to the new easy credit. The stock markets ticked up, and as that new money trickled down into the economy, more and more people invested -- causing the market to swell artificially even more so. The Fed did nothing but create more and more credit, which flew into the stock market pushing it higher and higher. Government inflation caused the market to bubble. The Fed tried to control the market boom by restricting that easy money, so those who were holding the stocks (namely, a decent portion of the population) had no one to sell to -- no more easy credit meaning no one else to buy those stocks. Quickly people sold off stocks, but the banks were restricted in paying out deposits because the Fed was trying to deflate the currency base.
The Fed caused the Great Depression.
The boom-bust cycle is nothing new, and not a product of inflation. Inflation is part of the boom-bust cycle.
I'm amazed people give you any trust or value, honestly. Inflation causes the boom-bust cycle as I easily explained in this post and in previous ones in the same threads. Inflation, the creation of money, gives people false indicators of a growing market. In a free market, stocks go up in value because they either pay more dividends, or because the company is truly worth more money now or in the near future. In an inflationary economy, stocks go up usually because another sucker used easy credit/money to buy stocks from a previous sucker, at a higher price. That's boom-bust. It is NOT part of a healthy economy.
I'll go out on a limb and say that over time, the boom-bust cycle is healthy. It promotes advancement during boom cycles, then weeds out the weak during bust cycles. In the long run, the boom-bust cycle promotes technological advances that result in increased standard-of-living across the board. The key is to mitigate the bust cycles so that the economy doesn't collapse.
Society blossomed during a stable currency base during the Industrial Revolution. Why? Companies and individuals found ways to become more efficient, introduce more products and services to the market, and reduce prices for everyone (deflation). This happened pre-fed, during a strong dollar that didn't fall more than a few percent in value over 150 years. The dollar has lost 98% of value since 1913, because of inflation/the Fed. In a strong dollar economy, people still create, but do so wisely because they find profitability in efficiency or new inventions. In an inflationary economy, companies sell nothing or junk (dotcom, housing) because they have easy access to easy credit, used to fool foolish investors.
Call me crazy, but the grandparent poster doesn't mention the gold standard once in his post.
He does mention that our economy is inflating somewhat rapidly, which can be very easily verified by taking a look at some graphs plotting the exchange rates for US dollars.
Whether or not this is an explicitly bad thing is a subject of debate. From what I understand, inflation is generally considered to be a good thing in small amounts, and that the US is on the brink of passing the cusp of these "small amounts".
Take a look at what happened in Argentina. Their currency became worthless almost overnight due to poor economic practices (nothing to do with the gold standard).
The grandparent poster then draws a bunch of conclusions from the assumption that the dollar is inflating, all of which appear pretty sound in the context of other economic inferences. If the dollar's worth less, as in any economic disaster, the people with the least money are obviously going to be the most affected. Because people have to eat, wages will then hopefully rise to try and catch up.
-- If you try to fail and succeed, which have you done? - Uli's moose
But energy can neither be created or destroyed, how can it be inflated?
(That's what you get for discussing economy with geeks...)
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
I pay $5 or less for my games. No hurry to get the latest, so wait until the price drops to what I'm willing to pay. "XIII", "Max Payne", "Oni", etc. are suitably entertaining, engaging, and cost less than lunch at McDonald's.
You want the latest? You are willing to pay $60 for the latest? Then, supply-and-demand, retailers will charge you what you're willing to pay for what you want - and that, for the collective "you", is working out to about $60.
Go figure.
Can we get a "-1 Wrong" moderation option?
Freeware games are here to suck.
Multiplayer Gaming (defined): Sitting around, discussing single-player games with my friends, at the bar.
The extension is that fiat currency is to blame, and that the gold standard would solve the problem. However, since he's been lambasted so much for his crackpot theories in re: the gold standard, he no longer refers to it by name in his posts.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
If inflation is 0% (stable pricing), then I am indifferent between buying something now or in a year, as my money is worth the same. If there is a small amount of deflation, I have an incentive to sit on my money, because it will be worth more in a year... If I get 2% by putting it in my coffee can, why not wait when things are cheaper. With small inflation (2%-4%), there is a reason to spend now (money becomes worth less in a year).
Basically, small inflation forces people to either spend their money, or save it in interest returning investments, or invest it... you can't sit on it. Small deflation causes people to sit on their money. If you look at the cyclical nature of the computer industry, the fact that the computer industry is deflationary has caused all those hiccups. For consumer goods, the built up supply chains of distribution work fine... doesn't matter if it takes 3-4 weeks to get the shampoo from the factory to the store to your home, nobody loses money... recently companies have gotten so good at just-in-time manufacturing, that they decided to worry about this, NOT because of deflation and collecting less money at the end, but because the finance department realized that the "inventory" that they are shipping around uses working capital (if I carry $20m in inventory, that is $20m that I am either borrowing or not investing, so there is a "cost" of the inventory). However, in the computer industry, Dell was the first to move to just-in-time, and decimated everyone... not because of carrying costs which are small, but computers deflate at 2% a month or so, so if it took two months to get the product there, they lost 4% of the value in the channel.
Basically, small inflation is devastating, because it means that the "real" risk free rate is negative. If expected inflation is 3%, and people expect a 2% rate of return for 0-risk, then the nominal interest rate for treasury bills is 5%. If inflation rises to 4%, then the interest rate foes to 6%, with no major change. If instead we get 3% deflation, then the "interest rate" SHOULD become -1% (-3% deflation + 2% required rate of return = -1%)... Now, who would buy a bond for -1%? Instead the money sits in the mattress. As a result, you might see an interest rate of 1% or 2%, but that means that the real interest rate is 4%.
A higher real interest rate means that people require a higher return for "risk," which means that bond yields go up (making it more expensive for companies to borrow money, which means that they don't invest as much in growth. It means that stock prices go down, because stock price today = NPV(future returns), and the higher the interest rate, the lower the NPV.
Basically, deflation => higher REAL interest rates => slower economic growth, plus deflation => lower expenditures while people hoard cash => slower economic growth. Deflation is VERY bad. Look at Japan's long recession, they couldn't get out of the cycle, because once you lower the interest rates to 0%, there is nowhere to go. When the US economy went into recession, the Fed was able to lower rates from 5.25% to 1%, which sped up the economy. The reason they moved it up so fast, they were scared that if another attack happened or something else slowed the economy, they had nowhere to move, they COULDN'T lower interest rates more, which meant severe recession or depression to fix things.
The Fed's ability to affect rates lets them tweak the economy. The tweaking works fine in normal conditions (moving between 3% and 5% GDP growth is manageable, once you get outside that range, the interest rate can't control it). The American people like to know that each year they will generally be a little better off. In the late 90s, you had red hot growth, which everyone enjoyed, but when the economy slowed to absorb those gains, people decided that a mild recession was a severe depression.
Look at the housing market, people expected 4%-5% growth, inflation + 1%, and while they enjoyed the 10%-20% growth while it lasted, it forced people into doing stupid moves to get ahead of the game... Now prices drop 2%-4% in a year, a minor fluctuation, and people are talking about a market collapse.
$50 is CHEAP! At least I think so. Look, before any of that cheat code / mod stuff they were charging in upwards of $50 a game. In fact, I remember visiting my local Magnavox dealer back in 1978 as a kid (I owned an Magnavox Odyssey 2 console and often, the Mag dealers were the only place you could obtain the games). No game ever came out under $49.99 (in specific I remember 'Thunderball' - a 3K game - cost $49.99) and when the Challenging Series was released, some of those games were $79.99!
Now last year, I GLADLY paid $70 for Half Life 2 and did not regret it. It was certainly worth that to me. But the price will always come down over time - it was true in the 70's, it's true now - and HL2 can be obtained for about half that now. A year after 'Thunderball' was released, it was down to $29.99 too.
Maybe it's the cost of the media against the cost of the actual creation of the game. Back in the day it was ONE GUY who did it all, but the media costs were very high. Now there are programming teams - sometimes numbering in the 100's of people. Games will go for whatever the market can bear. Apparently, it can bear around $60 for a game on average.
"...Well, there's egg and bacon; egg sausage and bacon; egg and spam; egg bacon and spam; egg bacon sausage and spam..."
If you watch the trends in currency exchange, you'll notice that the dollar has been losing roughly 10% per year to the euro and pound.
This is all well and good, but it doesn't measure inflation. Inflation is measured by how much the dollar buys in goods and services, not by how much it buys in other people's currency. The euro, etc. is also subject to inflation/deflation, and the currency market is also influenced by other pressures (i.e. our national debt, price of oil, the wars we are engaged in, etc). You're basically introducing a set of entirely new variables when you try to measure one currency against another.
The parent poster is correct. The only people who gain from deflation are people with lots of money piled up. Anyone with debt actually does well with modest inflation - you pay down the debt with money that is worth less than the money you originally got from the lender. Of course, you don't want runaway inflation, like Argentina, but there's no evidence of that such a thing is anywhere in our near future.
The Fed actually does a surprisingly good job at regulating our economy, and I'm shocked that a government agency can actually be that effective. Consider, we've had no economic depression since the 1930's, and aside from the Carter stagflation debacle of the 70's, no real sustained economic downturns.
...of money for the software industry.
2 /index.htm
Ok, I'll give you that, but can you explain why this is the opposite trend in the PC hardware industry?
Case in point, in 1992 I ordered what was then a top of the line PC:
* 486 - 66 MHz / 8 Meg memory
* 240 Meg hard drive.
* No CDROM
* No sound card.
* No networking or modem.
* Diamond Stealth 64 video card (Vesa local bus)
* Cheap case with floppy.
* 14 inch VGA muti-sync monitor.
* Mouse/keyboard.
* $2,500.00
This past Sunday 7/26 I just purchased my new baby:
* Intel D975XBX2 (Bad AXE) mobo with a load of stuff on board.
http://www.intel.com/products/motherboard/D975XBX
* Intel QX6700 (Core 2 quad core 2.66GHz)
* 850 Watt SLI power supply.
* EVGA GeForce 8800GTX 768Meg video card.
* 4 Gig DDR2 800 MHz RAM (PC2 6400).
* 320 Gig SATA 7200 RPM drive.
* Lian-Li PC1200B II case.
* 20X CD/DVD burner SATA.
* Windows Vista Ultimate.
* $2,800.00
Please tell me why inflation and rising development costs didn't have an effect on these prices?
As an engineer I can tell you that moving from the hardware technology of 1992 to 2007 was also "a lot of work" and required "a lot of resources" and "a lot of money". Yet based on inflation, I got a system that just crushed the older one into the ground.
Hmmm...
False dichotomy. Prudent investing is always possible. However, in a deflationary economy, there is an inequality that rewards those who hoard cash rather than investing.
The truth is that in an inflationary economy, there is a tax on saving. However, speculation is not the only investment strategy (and according to most wise investors, a very poor stretegy). Wise investment strategy includes investing in certain ventures based on real product. Consider IBM, for exmaple -- people invest in blue-chips like IBM because stick price is relatively stable but dividends are high. If what you say about an inflationary economy was true, no one would invest in IBM since it's not high-risk, high-reward. Yet funnily, it consistently returns above inflation. Did you forget that inflation affects returns on investments as well as the value of saved funds?
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
I read a definition of 'wealth' (in Rich Dad, Poor Dad, actually *) that was along the lines of 'the number of days you could live at your current comfort level without going broke, if you quit your job'. For most of us, that's a negative number, since so many people are in debt. He made the distinction between being rich (having lots of money), and being wealthy (having assets which, passively or actively, increase your net worth over time).
* This book was great up to the point where the author reveals how he actually got rich in the first place, going to mortgage foreclosure auctions and ripping off unfortunate families, to the tune of tens of thousands of dollars. The guys a vulture. If that's what it takes to turn a quick buck, I'm all for staying poor.
Rampant carbon sequestration destroyed the Dinosaurs' tropical paradise. I'm here to help repair the damage.