Stagnant Salaries vs. Inflationary Savings Tax

[Darker45]

From a layman, who would choose B? But in reality it isn't just inflation that's a big problem. Tax itself is another. We could consider inflation as another tax, but there are also existing taxes that are already smothering the lives of ordinary people. On top of inflation, there's income tax imposed on our salaries. On top of that, we are also taxed on the goods and services that we buy.

But the situation given in option A might not be reasonable. If a business is getting lower and lower revenue because the prices of the goods and services they're selling are getting cheaper and cheaper, it might also affect the salaries of their workers. The revenue of a business is the source of its workers' salaries.

[Smack That Ace]

C - Having to grow your salary by investing in Bitcoin even though you need to pay tax.

In short, we need to find ways to increase our income and investing in bitcoin is one of them, not the only way. Many people are well educated or have good businesses, they don't need bitcoin and they still have a very good life without bitcoin.

Bitcoin is indeed a potential investment but it is only for those who can accept high risks because of its volatility. Bitcoin is just a financial market, which means many people will lose money, not everyone will make a profit investing in it. Therefore, investment solutions to increase income depend on each person's preferences and are not advice for everyone.

[Rockstarguy]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

I'll always prefer this because no matter what you collect as Salary it can still be used to afford atleast the basic things you want, this makes life very easy. It is better than collecting high salary but still struggling to afford things and it make no sense. Inflation is very bad and earning a high salary is not a solution because even with that the money won't even have value to afford things.
But I doubt if this will ever happen because inflation will always exist and this is the reason price of things won't remain stagnant or even go lower.

Inflation is the reason why their will be an increase in the salary of workers and why people also strive to get more sources of income. If their is any where the price of things falls people won't even bother or struggle to get more income.

[Iranus]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

I'll always prefer this because no matter what you collect as Salary it can still be used to afford atleast the basic things you want, this makes life very easy. It is better than collecting high salary but still struggling to afford things and it make no sense. Inflation is very bad and earning a high salary is not a solution because even with that the money won't even have value to afford things.
But I doubt if this will ever happen because inflation will always exist and this is the reason price of things won't remain stagnant or even go lower.

Inflation is the reason why their will be an increase in the salary of workers and why people also strive to get more sources of income. If their is any where the price of things falls people won't even bother or struggle to get more income.

Everyone understands and knows that things are getting worse due to increasing inflation, but controlling inflation is not as simple as we think, it is not simply necessary to limit money printing to reduce inflation. Growing population, fluctuating supply and demand and even huge gaps are the leading causes of inflation. Not to mention the growing population and if the government does not print money, it cannot meet the needs of exchanging goods...It can be said that controlling inflation is not as simple as we think and depends on many factors, not just focusing on printing money.

[Reatim]

In short, we need to find ways to increase our income and investing in bitcoin is one of them, not the only way. Many people are well educated or have good businesses, they don't need bitcoin and they still have a very good life without bitcoin.

That is true however I think at this time bitcoin is one of the best investments to have so even if theoretically you are doing well I still think that it can’t hurt if you invest some of your money into bitcoin.

Bitcoin is indeed a potential investment but it is only for those who can accept high risks because of its volatility. Bitcoin is just a financial market, which means many people will lose money, not everyone will make a profit investing in it. Therefore, investment solutions to increase income depend on each person's preferences and are not advice for everyone.

All investments come with great risks you just need to learn how to manage them. Do not go into any investment without knowledge and a plan.

[Queentoshi]

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

I am okay with this option because with a stable salary and a falling price of things, the economy will remain stable, and you can always plan. With multiple sources of income asides your fixed salary, you will be able to live a fairly comfortable life.
When salary increases and then the prices of things are increasing too, it will seem that one is not making any progress financially, because whatever you earn will never be enough. You will work harder, but still never be able to meet up because when prices increases, it does not happen once and stop there, it can keep going.

[slapper]

You want to know if lower pricing and a steady paycheck are preferable, right? Sounds tempting! Imagine getting your desired item cheaply. Deflation this nice is called constructive. What if dropping prices slow the economy? That means less work, spending, and smart money management. That steady wage seems bad now

Inflation... seeing your money devalue stinks. Inflation can also indicate economic growth. If jobs increase, pay may follow. See the problem? Keeping what you have versus risking it for progress. Which is worse? Is there a good choice? Thinking beyond today is essential. What decisions are you making now that will make you high-five later? It's about making wise, long-term decisions regardless of the economy, not just surviving the inflation or deflation rollercoaster

[Moreno233]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

This is not even up for debate in any way. No one love inflation not to talk of those working and earning salary. Inflation is their greatest nightmare. The only people that don't feel the direct impact of inflation are business owners who will just respond to the inflation by increasing the price of their goods and services. Unlike those earning salary, even if the companies they work in make salary adjustments, it will rarely be in the equivalence of the inflation. My country is currently facing the worst inflation in our history, cost of commodities rose by 200% and even electricity was increased by 345% yet salaries were adjusted by 20% and some companies adjusted to as low as 12%. It is therefore obvious that inflation favors business owners while deflation favor those on salaries. Whatever be the case, I will chose deflation over inflation.

[avikz]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

Isn't it obvious? Anyone would choose the first option where the salary will remain constant but the purchasing power will increase. That's a very obvious choice!

I don't see any reason for anyone to choose the second option when compared to the first one. But deflation is good in short term. It cannot go on for eternity. Then it will have a very different consequence.

[|MINER|]

Of course deflation is good.  Falling commodity prices is far better than stagnant wages, because inflation can never be good.  Inflation is a threat to a country.  As a result of inflation, people slowly become bankrupt. But it becomes easier for people when the prices of goods fall due to the stagnation of wages. People can make an adjustment between income and expenditure. If the prices of goods also fall along with wages, people's lives may return to normal.

[BITCOIN4X]

~Snip

Actually, these two things are very difficult choices to choose, but because you only have these two options ready. So I will choose point A with a stagnant salary condition because there is still a salary that I can get every month. In fact, I can have a little freedom to do other things in order to increase my income so as not to be disturbed by real purchasing power which could tend to increase. Because for the second option in option B, of course this will be felt more by everyone even though it will be based on the amount of savings each person has.

I understand why you chose A as the answer, it's obviously because you have more sources of income instead of one. Then what about the others?
I don't think I should choose the first option when I am a businessman. Low taxes that are at least relevant to the provisions are the most reasonable thing for me to consider regardless of the current state of the country's economy. Choosing option B is also not bad in certain circumstances, but be aware that any income you receive in the form of salary will be taxed at varying rates.

Personal Income Tax or what in our country is called PPh OP is a tax imposed by the government on every person who receives income from certain types of work within the jurisdiction of our country. The percentage varies, from 5% to 30% based on conditions. However, not everyone needs to pay it as long as it is not included in the taxable income category.

[Hamphser]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

A of course!

Who wouldn't want on having that kind of stagnant salary but the prices of goods and commodities goes down? The important thing on here is that we wont really be able to experience hardship
on surviving on daily which it is really that not something that it is happening today which is the opposite. People would really be that getting contented on the moment that they do able to
survive themselves on day to day living without having no issues since they do know that they could purchase up something that they do need.

Option B is shit because no matter how salary would be increasing but your savings having that 2% inflation per year then it do basically lessen up your purchasing power
on which of course its not that a question on which one you would really be choosing obviously.

[wxa7115]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

There is not much of a discussion to be had as scenario A is by far the best, and funnily enough that is how the economy could work if governments did not printed all the fiat they want.

After all in an economy in which your money was backed by gold, money creation will be a slow process and only a very mild inflation will exist, however as our technology improves and better methods are discovered to create the products we want, the price of goods will go down and their quality will go up, creating the first scenario you present.

[angrybirdy]

Which of these economic situations would you prefer to find yourself in?

A-

Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

Obviously, I would choose the option A even if my current salary now become stagnant as long as the prices of everything that we need, falls. I mean, People only demand a high salary increase because the cost of living increased as well, Of course, who wants high prices and expenses, right? Automatic when that happens, some of us have no money to save? the money we earn, all of that will only go to expenses and bills, we will be in survival mode unless the salary is very high, we are all aware that the rest of us are only minimum wage earners, so we will literally work to survive every day.

[kryptqnick]

I'm totally fine with option A. I don't care about the number rising, you know. What matters to me is purchasing power, so having the same salary but being able to afford more and more on that salary doesn't sound bad. But, honestly, I don't understand why it's a salary option vs savings taxation option. 2% inflation rate isn't much, and one can keep the savings not in fiat (in gold, in Bitcoin) to avoid that. So if with option B there's also constant salary growth above inflation, it's also a good model.
Thinking of countries, I feel like option A is similar to the situation in Japan until recently, and B is similar to the US.

[el kaka22]

How would A even work? I have been alive for 34 years, never seen a single nation like that, even the Swiss have inflation, which is tiny but they still do, and I have checked the history of many nations (not all) and never seen anything like that before. Of course people would prefer A if that could happen, we all know that people would solve it, but the reality is that we are not going to see it happen at all, it is not going to be possible.

We just need to realize that we can't make it work, we just need to realize that A is impossible and the only thing we could have is B, or basically we are going to have neither in normal cases, we just need to realize that we are not going to get anything major out of this at all, it is just useless question.

[serjent05]

How would A even work? I have been alive for 34 years, never seen a single nation like that, even the Swiss have inflation, which is tiny but they still do, and I have checked the history of many nations (not all) and never seen anything like that before. Of course people would prefer A if that could happen, we all know that people would solve it, but the reality is that we are not going to see it happen at all, it is not going to be possible.

I think this is a fantasy question, since the situation works only in fantasy. Option A is a good way to save money, even with a fixed income when the prices of commodities are getting cheaper, it means that the purchasing power of our money is getting stronger thus we can pay less with the same amount of products we bought.  In the latter year, we will find ourselves rich because we have saved a lot thanks to the price depreciation of all items.

We just need to realize that we can't make it work, we just need to realize that A is impossible and the only thing we could have is B, or basically we are going to have neither in normal cases, we just need to realize that we are not going to get anything major out of this at all, it is just useless question.

True that, option A is impossible to happen, the reason why I called it a fantasy situation, and no one will choose B because not a single sole would want to lose money let alone a fix 2% deduction to our savings, if we failed to add fund to our savings due to not enough income, we will find our savings getting emptied just like how banks charges their client that does not have the minimum requirement of savings on their account.

[macson]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.


B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

Honestly, i prefer A because if i imagine it, it will make me calm mentally, inflation makes the price of goods continue to increase while income decreases, but the reality that is happening right now is that inflation is unstoppable, especially in my country, the price of rice rises 3% every year, this is very making things difficult for several groups of people, just imagine in the next 5 years, how much inflation will make the price of local rice in my country soar from now.

[dezoel]

I think the answer is obvious here and that would be none other than letter A. The more it favours to those who already have a higher salary. It may not rise anymore because it's stagnant but still, the prices of the goods are still falling, so this still allows them to have more purchasing power as you said there.

The reason why no one wants letter B is that no one wants to get taxed because it's only a decrease of money, especially if what we are earning is already low. Then our savings will also be subject to inflation? I think that's overkill but it's only funny or crazy that this is the reality and not the option A there, however there are still remedies with it if we will keep looking and trying.

[uchegod-21]

Which of these economic situations would you prefer to find yourself in?

A- Your salary is stagnant but prices fall. Where this happens, your real purchasing power has increased.  It's called constructive deflation. And even if your salary falls, but prices fall faster, you are still ahead.

This is great and any country experiencing this should be regarded as great and lucky. They have good purchasing. It's because government is placing subsidy on the prices of goods.

B- Having your savings taxed 2%+ a year by inflation.

Drop your thoughts

I didn't understand this. I thought you were going to say "having your salary raised and prices of goods raised also.

But which ever option is still good because in my country what is obtainable is totally different. In my country, salary is stagnant and prices of goods raised upto 7x within 3 months or so