halalmoney on Nostr: If money held its value over time—as in the case of sound money or hard money—the ...

If money held its value over time—as in the case of sound money or hard money—the impact on discretionary spending would be shaped by several economic and behavioral factors:

Increased Incentive to Save:

When money is stable and not eroded by inflation, individuals are more likely to save rather than spend immediately. This is because the purchasing power of saved money remains intact, rewarding delayed gratification and future consumption.

Reduced Urge for Immediate Consumption:

With sound money, the incentive to "spend now before prices rise" diminishes. People may become more selective about discretionary purchases, focusing on quality and long-term value rather than impulse or inflation-driven buying.

Higher Capital Accumulation:

Stable money encourages individuals and businesses to accumulate capital for future investments, which can support economic growth over the long term. Discretionary spending may then be directed toward investments that promise future returns, rather than short-term consumption.

Impact on Debt and Credit:

Sound money tends to discourage excessive borrowing and debt-fueled discretionary spending, since inflation does not erode the real value of debt. This may lead to more prudent financial behavior and less consumer debt.

Shift in Spending Priorities:

Discretionary spending might become more focused on durable goods, experiences, or investments that appreciate or maintain value, rather than on ephemeral or rapidly depreciating items.

In summary, under a sound or hard money regime, discretionary spending would likely be more measured, with a greater emphasis on saving and investment, and less on immediate, inflation-driven consumption. This supports long-term wealth accumulation and economic stability.

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