Running Debt - Increase of The Nominal Value of its Financial Products

In my opinion, is the oldest economic trick in the book. Borrow money to save his; overtime inflation reduces the debt. Increase of the nominal value of its financial products. Jump interest rates after inflation drops in, then pay off the loan the borrower goes to the top excess. It never worked. Or has it?

Well now, what we do. What is some evidence that it is working. Well, for one example, the banks want to stop offering home loans for 30 years, because this model could actually cause them to lose money or take a tough cut of profits. So come on this news is proof that something is happening. For example.

$ 100,000 loan 4.5% interest rate for 15-year average inflation of 3.5% with zero interest rate on bank ---------------

$ 110,092.91 <1% won

How do the banks actually only <1% of the profits. And the future is looking inflation hit double digits, this model could seriously undermine the huge dent in your loan interest rate profits. This happens because you can see all the home foreclosures scramble, etc. to gather as much liquidity as possible, the bank ...

However, government debt, this is a good thing. Even if we had just a year, super-high inflation rate, the couple, which is 12% +. This would increase the 15-year average rate to a level well enough to dilute the debt, and actually cause damage to the creditor and the debtor's profits go. Well we all know that the reality of the situation is 1000 times more complicated, but at the end of the day, this model is where it all comes down to.

Why do not people do this? Two things, in addition to the basic economic knowledge of mathematics, and there is no stable job with enough income last! [No offense to all]. The government certainly has a lot of different ways that the insane amount of money each year! But now, because we have technology as well. So people can now do something to understand and use this model. You can use this model to plan your finances and investments in the future.

So what are the relative variables to take care to ensure that this works, the government's side. Keep the average household income will increase more slowly for some time, until repayment of debt [how they do it is another story]. Fix up real estate and make it more accessible for future generations re-insured banks in the long-term super-profits. In this way, banks remain calm and not start a cash calls, and quickly, and the same is true for everyone else. Increase in inflation-adjusted prices soaring. And my favorite, by increasing the financial assets, mainly stocks, that is capitalism is beneficial to anyone who has enough on board.

You can accept that what they mean to you. but since that date, if you want to move the fuel end of the cash and you can not have a credit without it. Or, you can?

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