Inflation

Back in my days as a financial planner I would talk to small business people about setting up a pension for their employees. They would often counter my reasons for having a pension, by pointing out that when they ask their employees, whether they would like to set money aside for future use in a pension or have a Christmas bonus they most often preferred the bonus. I would point out that when these employees got older and closer to retirement they would be upset that you did not set up a pension. They would say that the owner should have known that they did not have the self-discipline to save and forced them into a pension. We have a similar situation going on today regarding tax and spend vs save and invest. Most voters want the government to print more money and give them immediate benefits. In five years when inflation starts to really impact the poor they will demand to know why and the answer is when you just print money it will cause inflation. Then the voters will complain that no one told them about this and they will be right since the politicians don’t like to talk about bad things happening in the future. They only want to get elected today and not have worry about tomorrow. This is want they mean by kicking the can down the road. Many people alive today were not around when Jimmy Carter was President and they don’t know what 13% inflation can mean. In those days the stores still stamped the price on items and the consumers could see how prices were going up so fast that prices were over stamped.