“Inflation” is a supposedly technical term reserved for the understanding of professionals in banking, business and industry. The reality of an already high and still progressively higher inflation rule in the country is periodically revealed by the government agency concerned. And from time to time as well, the common tao hears it and in fact also feels it – but without really grasping its “What?”, “Why?” and “How?”
For what it could be worth, it might be good to say in but one plain and simple word what the technically financial big word “inflation” really is. This: Air! It is nothing more or less than air – hot or cold air, much or little air, but air it remains. It is not hard to picture or imagine what inflation really is: Take a balloon. Blow air into it. And the balloon becomes bigger for having much air. Let go of the air, and the balloon simply becomes smaller for containing less air.
Inflation is exactly that, i.e., making money full of air that it buys less. The money remains the same in amount but it becomes less and less in value for being precisely inflated--blown up--with more and more air. This is why as the so called “inflation rate” goes up, exactly the same amount of money having but more air in it, buys less goods and pays more for the same purchases. In other words, the bigger the inflation, the bigger as well is the financial curse of the consuming public.
Take the infamous ease of a much deregulated oil prices vis-à-vis a very regulated wages of workers and salaries of employees. While people take home exactly the same amount of money and buy exactly the same food and other consumer items, as a matter of fact they pay much more for them. The result is well predictable. They not only have less goods they need, but also less money in their little pockets.
Lately, it was officially announce that the inflation rate in the country has risen to no less than 11.4%. The disturbing and depressive significance of this amount of air injected into the Philippine peso has the following more pitiful relevance to the millions of common Filipinos--with the infallible exception of a good number of distinct public officials specially in the national level who in fact have always so very much more than they deserve and need, and even accumulate more and more in their many local and foreign bank accounts:
One: More and more Filipinos suffer from hunger, sickness and misery.
Two: More and more business enterprises sell less and less.
Three: More and more underdevelopment affects the country.
Four: More and more people signify their resentment and dissent.
Five: More and more luxuriant government officials become nervous.
Question: Who in effect inject air into money, who in fact cause inflation, who make inflation bigger or smaller? Answer: The speculators. Result: Few speculators become richer. Millions of people become poorer.
7 July 2008