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should the US consider a currency redenomination? (lemmy.zip)

submitted 8 months ago by shortwavesurfer@lemmy.zip to c/personalfinance@lemmy.ml

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Prices of things are becoming absolutely insane. $800+ rent, $30,000 cars, $10 sub sandwiches, etc. It would be nice to do a 3/1 split and cut everything by 2/3. Then we would have $266 rent, $10,000 cars, and $3.33 sub sandwiches. Wages, debts, everything would drop to 1/3 what they are now. It would also make coins useful again since a vending machine soda would be 2 quarters again.

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[–] amio@kbin.social 7 points 8 months ago (1 children)

No. Costs rise all the time. Ideally, so does your income, giving you mostly the same purchasing power as before - just because 10 is a larger number than the 8 you paid a year or two ago, doesn't mean you realistically expended more value (e.g. time spent working, or foregoing other things).

Rejiggering this would involve a lot of work. It would not give you any more or less value, it would be cosmetic. It would also be based on a very subjective "this shouldn't cost as much as $X" where both X and the rough value of the $ are... just something you happen to be used to. A trivial example is how this looks to anyone with a different currency, or to an American in a different time.

Now, of course, a large amount of people in the entire Western world have gotten shafted for 50 years plus, and the purchasing power has gotten even worse in the past 5, but that's basically a separate issue.

(Also, coins are pretty expensive compared to paper money, IIRC)

[–] shortwavesurfer@lemmy.zip 1 points 8 months ago

Yeah, incomes have risen a hell of a lot slower than inflation causing the average person to be poorer overall. Redominating the currency would not fix that problem. That is a systemic issue where inflation is higher than wage increases, so people demand higher wages, which then causes inflation to increase, and it's a spiral.