Who benefit from inflation?

Answer 1

The mint, I'm sure the guys on the mint floor get paid plenty of overtime staying longer to print more money. Those are the only folks I can think of.

Answer 2

The only ones who benefit from inflation are those who have taken loans/credits. I'll give a short example:
- You take a loan of $1000. At the time when you take it, you can buy for example 100 gallons of gas (1 gallon = $10)

- The next year the price of a gallon of gas is, lets say, already $20, so the $1000 you've taken are worth just 50 gallons now.

So, even if you see at the equivalent of the $1000 in the first and the second periods, you will see what the difference is - you have to return less than you have taken, just because the money has become cheaper and the goods - more expensive, which is the same.
I come from a former communist country, where after the fall of the old system many people have become rich from the high inflation that we had here. They have borrowed thousands of dollars, bought expensive villas, cars, etc. and after a year or two when they had to give back the money, the inflation was so high that everything costed millions already. Millions that actually couldn't bring you anything. So, you could pay your loan dating back 2-3 years ago with a whole bill of 10000, which was worth a chewing gum at the moment.
Don't know if I have described it well, but I hope.

Answer 3

Generally speaking, the answer is "borrowers". This includes both government (which is in most cases responsible for creating inflation) as well as private borrowers.

The reason why borrowers benefit is because money is worth less over time when inflation is high. For example, let's say you were a baker and you borrowed $100, and you have bread selling for $1 per loaf. If inflation were 0%, after 1 year you would have to sell 100 loaves to pay back your loan (assuming no intrest). If on the other hand inflation was 100%, a loaf of bread would now sell for $2, so one yr on you would have to sell only 50 loaves to pay back your loan. You can keep the money for the other 50 loaves you would have had to sell under a no-inflation scenario to yourself. If on the other hand say inflation were NEGATIVE, you would have to sell MORE than 100 loaves to pay back your loan, so you lose even more.

Historically, inflation has happned in most countries because governments borrowed a lot of money, realized they couldnt pay it back, and so created a lot of inflation by printing money (something that you and I cannot do) to do a "back-door" reduction of their debt burden. So yeah, if you feel the pinch of inflation, blame the government. It's one area in which they really deserve the blame.

Answer 4

It depends what kind of inflation we are talking about, because not everything gets more expensive at the same time.

If things get more expensive 10% in one year, but housing prices rise by 50%, then definitely home owners are the winners (if they sell before the bubble bursts!)

Answer 5

borrowers benefit as the value of money would have reduced by the time they are returning it. government will also benefit from an increase in price laeding to an increase in GDP.

Answer 6

Nobody. Governments and their fiscal policies try to fight AGAINST inflation. Nobody wants it.

Answer 7

Well , technically NO ONE ! One who charges higher also has to pay higher ! In the LONG RUN, it`s a loss, but talking about a short run, it`s a different case !
Pleasure to HELP !
Salik

Answer 8

Traders who sell

Answer 9

Not me!

Answer 10

nobody