The richest man in the village printed money, and as a result, the whole village became poor, and only three people became rich. There is a village of 100 people, each of whom has 100 yuan, and the whole village has a total of 10,000 yuan. The village chief opened a steamed bun shop, one dollar a bun, and suddenly one day the village chief secretly printed 10,000 yuan, but he was very smart, he didn't spend it directly, but first found his brother-in-law and cousin, lent them 3,000 yuan each, and took the money to do business, and the interest was very low. The brother-in-law took the money to buy all the flour in the village, and the cousin took the money to buy all the good land in the village. A month later, the villagers noticed a strange thing, the price of steamed buns rose to two, flour to three, and the price of land increased fivefold. Everyone is scolding all the evil inflation, but if you look closely, who is making money in this inflation? The village chief printed 10,000 yuan, which was spent first and benefited first. The brother-in-law tun flour monopolized the price increase. My cousin bought land, the assets appreciated, and the wages of the other 97 people did not rise, and their purchasing power was halved, which is the first secret of inflation. Inflation is a redistribution of wealth, from poor to rich, from hindsight to foresight. But the story is not over, and the villagers are angry and demand a salary increase from the village chief. The village chief said yes, everyone's wages were doubled, and the villagers were happy for a day and found that the buns had risen to four yuan. Why? Because labor costs have risen, the price of steamed buns has to rise, which is called wage-push inflation. At this time, Ergouzi was very smart, he borrowed 1,000 yuan with interest, an annualized rate of 10%, and bought a cow. A year later, the cow rose to 2,000 yuan, and he paid back 1,100 yuan, making a net profit of 900 yuan. Ergouzi discovered the second secret of inflation, debt will shrink in inflation, and borrowing money to buy assets is the biggest winner. But Uncle Zhang next door is miserable, he has saved a lifetime of 1,000 yuan of pension money under the bed, after inflation can only buy 250 buns, he used to be able to buy 1,000, and 75% of his asset purchasing power was stolen. Uncle Zhang's lesson is the third secret of inflation, cash is the biggest victim of inflation, and saving money is equivalent to chronic suicide. At this time, an economist came to the village, and he said that moderate inflation was a good thing, and the people in the village wanted to beat him. The economist explains, you think about it, what if there is no inflation, or even deflation, that things are getting cheaper? Everyone doesn't buy things anymore, and tomorrow it's cheaper, and the village chief doesn't make steamed buns anymore, anyway, tomorrow will be even less valuable. The second dog no longer raises cattle, and it will not appreciate if it is released, so won't the economy of the whole village stop? It's called a deflationary spiral, and that's the fourth secret of inflation. Moderate inflation of 2% to 3% is the lubricant of the economy, encouraging consumption and investment. Zero inflation is stagnation, and negative inflation is disaster. But the villagers will ask, what about hyperinflation? Economists tell a true story that the German money printing press in 1923 was so crazy that it cost 100 marks to buy a loaf of bread in the morning and 1,000 marks in the afternoon. The workers pay their wages, let their wives wait at the gate of the factory, and run away to buy things as soon as they get the money, and the money is worthless if they are 1 hour late. At the craziest time, people burn money to keep warm, because money is cheaper than wood, which is hyperinflation. How can you tell the extent of inflation? There is an old Chinese medicine doctor in the village who said a local method, looking at three things, haircut, rent and pork. The increase in the price of haircuts indicates that the cost of labor has risen, which is real inflation. The increase in rent is an increase in the price of assets, which is real inflation. Pork price increases may be swine fever, but not necessarily inflation. But if all three go up, it's definitely inflation. If it only rises by one or two things, it may be structural inflation. At the end of the story, the villagers have learned to be smart. Wang Fugui borrowed money to buy ten acres of land, and five years later he became a landlord. Boss Li exchanged cash for equipment and made money by expanding production. Widow Zhao bought the only well in the village to collect rent, and Aunt Zhao is still saving money, and after five years, only 30% of her purchasing power is left. This is the ultimate wisdom that inflation teaches us, in the era of inflation, we must be Wang Fugui to borrow money to buy assets, not to be a money aunt to save money and other depreciation, to be the beneficiary of producers' price increases, not to be the victims of pure consumer price increases. Remember, inflation is a game without gunpowder. Government is the spoils of cognition, it is wealth. Whether you are a predator or a predator depends on whether you understand the rules of the game or not. Why does the government like inflation? Because it can dilute the national debt, it is enough to owe 100 trillion yuan of debt, inflation is 50%, and it is enough to actually repay 50 trillion yuan. Why aren't the rich afraid of inflation? Because they have pricing power, if the cost goes up by 10%, the selling price will increase by 15%, and the profit will be higher. Only wage earners are the ones who are hurting, and wage increases can never outpace inflation, which is why you feel like you are getting less and less money to spend. The last secret, inflation is irreversible. Historically, there has not been a long-term appreciation of any country's currency, it has been a long-term depreciation. A dollar 100 years ago is now only three cents in purchasing power. So learn to dance with inflation, not against it, and those who take advantage of it become rich, and those who fight inflation become poor, these are the rules of the game in a cruel world.