In reply to Jürg Wyttenbach's message of Sun, 25 Oct 2026 00:22:39 +0200: Hi, [snip] > >On 24/10/2026 20:23, Robin wrote: >> Scarcity leads >> to higher prices, while overproduction leads to lower prices. The system is >> self regulating. > >Works in the case of lean production. But stocking goods needs capital! >Hence its rate sensitiv.
Stocks can be built from profits, with the exception of a small amount of feedstocks to get started. Eventually all profit making enterprises result in lean production. If they don't make a profit, or at least break even, they fail. IMO the real cause of inflation is the fact that markups are based on percentages rather than added cost. If the latter principle were to be adhered to world wide, inflation would not be such a problem. However governments tend to like inflation, because it decreases government debt in real terms, while increasing government income. I.e. if you borrow $100 today your debt is $100, but you pay it back with inflated dollars that are worth less in real terms over the period of the loan, and yes I know that you pay interest on the loan, but that is also paid off with inflated dollars. > > >J.W. Regards, Robin van Spaandonk http://rvanspaa.freehostia.com/ELE.html
