Not long ago, an invoice of $ 100 could cover dinner, a movie and drinks. Today, it may not even be enough for food alone, and in another decade, it is likely to stretch even less. That is not a chance of bad luck, but a characteristic of modern monetary systems: inflation is integrated.
In a new cointelegraph video, we examine why money constantly loses value over time and why governments really want it in that way.
The story begins in 1944 with the Bretton Woods agreement, when the US dollar was tied to gold to $ 35 per ounce. That link ended in 1971 with the “Nixon Shock”, turning the dollar, and each important currency in the world, in pure trustee, backed only by the government trustee.
Since then, the purchasing power has been in a constant decrease: a dollar in 1971 buys what takes more than seven dollars today. Of course, money impression is not the only driver. Energy shocks, supply chain interruptions and the increase in wages also raise prices.
And although the central banks insist on inflation of around 2% is “healthy”, the long -term effect is the devaluation of the fiduciary currency. So what does this mean for savers? And is there an alternative to the Fiat system?
Some argue that Gold or Bitcoin (BTC) offers protection because they are scarce in a way, the paper money is not. Others warn that without the supply of flexible money, economies would collapse under debt.
The full video of Cointegraph is more deeply immersed in this story, the risks of fugitive inflation and the strategies that people use to protect their wealth. Watch the full video on our YouTube channel.
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