Friday, 5 February 2021

Inflation and Gravity


I've always thought gravity is the force that pulls me down to Earth. If not, I would have floated into deep space.

Then as I watch more documentaries about Cosmos (I love to watch documentaries), I realised its in fact the curvature of spacetime that's pressing me down to Earth!

Its a subtle difference.

The same goes for inflation.

If you define inflation as things getting more expensive, you'll probably accumulate more money to combat inflation.

But if you define inflation as money getting smaller and smaller as in worth less and less, would you still be accumulating more money to combat inflation?



  1. Wow, this is heavy stuff (pun intended). Hard to wrap my mind around the metaphorical link between gravity or the force generated by the spacetime curvature to inflation and shrinking value of money.

    My current understanding is that while we are within the planet's atmosphere, we are indeed under the influence of the earth's gravity. If there was no gravity, we would be flung off into space by the centrifugal force generated by the earth's rotation.

    The approach to address the shrinking value of money also works in addressing inflation no? While the converse may not be true though.

    1. mysecretinvestment,

      To fight inflation, do we combat it by having more money under the mattress, in the banks, and in CPF?

      Or are we better off by having less money rotting away?

      Just take a look at how during inflationary times, how the poor and rich "suffer" differently.

      Some of the rich even benefit from high inflation!


  2. Hi Smol,

    Hoarders & karang guni are combating inflation by accumulating more stuff before prices go up. Don't play play horr! 😂

    Of course money comes in different forms, SGD being just 1 type of format. Hint, hint...

    There are also companies which can raise prices, raise dividends & maintain profitability --- although will be tough in hyperinflationary environment.

    One thing gotta say though ... SGD has done better against debasement/inflation than many others.

    Anyone remembers when 1 GBP = 8.57 SGD in the late 1960s?

    Or how about 1 USD = 3 SGD in the 1970s?

    And yeah, MAS actually pegged our SGD to GBP and USD in decades past! The old guard looked at the situation in the mid-1970s and said "To hell with it!" And that's how we got our secret basket of currencies & the SNEER. LOL.

    1. Spur,

      The 70s is a period of double digits high inflation with 2 oil shocks thrown in for added spice!

      Imagine a young 20 something British or American sailor who fell in love with Singapore during the 70s. Everything in Singapore is so cheap after converting from GBP or USD to SGD!

      Tells himself he would retire to Singapore 40 years later in his 60s. So he voluntarily saves and saves.

      Imagine the rude shock when he emigrates here to Singapore 40 years later!!!

      OK, that's the citizen of the world perspective. Singapore and SGD have not done so bad.

      Especially if a Singaporean is willing to relocate to another country after retirement by leveraging on our stronger SGD.

      Of course its better to sell HDB 3 room and buy landed overseas than the reverse!!!

      Now let's take a "beat dead won't leave" koala or panda perspective.

      During the 70s how much does HDB 3 room cost? How much does landed property cost?

      Then compare to how much youths today are paying.

      For old fogeys who have gone through this amazing price appreciation (some would call it inflation), how would they as parents today teach their children on how to beat inflation?

      Accumulate more SGD?

      Or accumulate more "stuffs"?

      I like your example of karang guni hoarding "stuffs".

      "Stuffs" can equal assets; or it can equal trash.

      That's the difference between EARN MORE and SAVE MORE.

      EARN MORE requires brains (or luck) to tell apart trash from assets ;)

  3. How to beat our household expenses inflation when we retire?

    Get married, more children, earn more, save more, spend more and then when we retire and children are on their own; we naturally beat future inflation during retirement with all our accumulated money over the active years.

    Smaller money with smaller household expenses, we can beat inflation with more money! LOL!

    1. CW,

      Ah! True, true.

      Like the duck who appears calm and graceful above the waterline. What's there to sweat?

      Below the waterline, peddles furiously...


  4. Woah spacetime, so cheem, not many people know wor.

    Inflation is supposed to encourage people to spend/invest now and not hoard money.
    But also, interestingly, like we discussed earlier, hoarding "cash" is different from hoarding digital money.

    I like the perspective given here.
    Are you chasing inflation by trying to out save it, or riding with inflation buy holding assets. Any physical asset better than conceptual money.
    Paper/metal cash also considered potential physical asset.

    1. ERSG,

      Yes, this post is a spinoff from our recent discussion.

      I like to mind-fxxk with readers at this watering hole ;)

      Of course physical cash - as in coins with copper or silver content or numismatic value - is different from digital money.

      Just like money is money, currency is currency. Most people think they are the same; they are not.

      I think we better stop here before we confuse more people ;)

  5. Hi SMOL,

    So theoretically we can influence space-time by placing a very small but massive object in front of us, so that we can 'fall' towards the direction of the massive object we placed. This allows us to travel for free without energy. What energy does it take to fall to the ground on earth? Nothing! Imagine if we can similarly 'fall' to our workplace and 'fall' back to home lol

    Drawing parallels to your case on inflation, that massive object we place in front of us could be something that we can do very well and we like. If we can do that, we can probably earn more than inflation and ride our way to freedom haha

    My mum has a interesting way to beat inflation. She likes to help people - either using time or money - then when the people she helped returns the favour, it's inflation adjusted and can last for years. So if she uses say $500 to help someone, she gets back more than $500 in the form of goods, services, money, favor. I think that's another way to look at combating inflation - cultivating and investing in humans. In truth, she is like a VC!

    I seldom got stunned, but I did get stunned when I read this from you,
    "But if you define inflation as money getting smaller and smaller as in worth less and less, would you still be accumulating more money to combat inflation?"

    Haha, well done :)

    1. Thanks LP!

      Your small but massive object analogy has nicely encapsulated the essence of why I often make the distinction between trading/investing to achieve; and trading/investing to escape ;)

      I am definitely right-brained biased.

      Can't help myself for having a bit of fun with left-brained people who are so focused with precision in decimal places that they lose sight of the big picture ;)

      You are one of the few and rare cool cats at this watering hole that have BOTH left and right brains equally developed.

      Its always nice to know someone out there gets it!

      What is an asset?

      Most left-brained people would just associate it with physical objects or financial instruments like paper assets.

      Can relationships or EQ be an asset???

      Since I'm a wordsmith, what if I changed it to "networking"?

      And if I quote, "Its not WHAT we know, but WHO we know"?

      There you go! LOL!

      Some parrots have a narrow definition that if something does not have cashflow or yield, it cannot be an asset. Because so and so said so!

      I guess these people will never understand why some businessmen will pay millions to acquire a Brand or Trademark from a bankrupt company...

      How about the reputation of individuals or institutions?

      You mean the "assets" of elite schools are just the bricks and mortar?


    2. Hi SMOL,

      Agree. Social capital is an "asset."

      I will go all the way out to help 3 other youngster bloggers if they ever need help. Their humility, work ethic, and values impress me.

      On the other hand, there are some others who torpedoed their relationship with me because of how they conduct themselves. I wish them well.

    3. Unintelligent Nerd,

      Its OK to say NO to others.

      When we can't, or are afraid to say NO to others, that's how we ended being unhappy and miserable with ourselves...

      Self awareness is one of the most important traits of EQ.

      Some people just pisses people off wherever they go.

      I mean if they can't get along with colleagues or their bosses in one or two companies, can excuse its bad luck.

      But EVERY single company they've ever worked in?

      Maybe the problem is them? Just saying...

      Charisma is both born and cultivated.

      Just like leadership and selling skills ;)

  6. Hi guys,

    Reminds me of someone I knew who worked in different companies and always had trouble with the bosses or superiors. In one company, the boss don't like him. In another company, the colleagues sabo him. And so on and on. Every other year I'll hear him complain about his work troubles.

    If you had problems everywhere you go, the problem is with you. Lol

    1. LP,

      Beavers and humans are the only 2 animals that can create their own habitat.

      If I am the one with the problem, I would most probably be my own boss (create your own environment), or be an independent contractor like a taxi driver or do food deliveries (work alone).

      I suspect some doctors are like that too. They prefer to have their own GP clinic than work in a big hospital with lots of hierarchies...

      Being different is OK.

      However, nothing is more sad than that dog that sits on a nail and howls away...


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