Hoarding does not make us all poorer. Your blanket statement is false.
If you're living in a country with a gold standard, and that currency appreciates, it means you can purchase more real goods, not less.
China's economy has seen its currency appreciate for the last decade, while they simultaneously get far richer. The same principle was demonstrated by the last manufacturing powerhouse: the USA.
If I hoard dollars under my mattress, which reduces circulation, then all the other dollars gain purchasing power in direct proportion to my hoarding: ie I make everybody else richer while I hoard. The exact same thing is true about gold: any currency backed by gold gains real purchasing power.
Yes, but the incentive not to purchase more real goods increases as the currency appreciates because every unit of currency not spent now will be able to purchase even more real goods in the future. Hence, people avoiding spending now except for essential goods.
This inevitably results in massive deflation and eventually destroys the economy, rendering the accumulated appreciation worthless.
China's economy has seen its currency appreciate for the last decade, while they simultaneously get far richer. The same principle was demonstrated by the last manufacturing powerhouse: the USA.
Yes, and in both cases this happened after the countries stopped fixing the supply of money. In the US, this was moving off the gold standard, in China, this was moving off of the USD standard.
Hoarding does not make us all poorer. Your blanket statement is false.
If you're living in a country with a gold standard, and that currency appreciates, it means you can purchase more real goods, not less.
China's economy has seen its currency appreciate for the last decade, while they simultaneously get far richer. The same principle was demonstrated by the last manufacturing powerhouse: the USA.
If I hoard dollars under my mattress, which reduces circulation, then all the other dollars gain purchasing power in direct proportion to my hoarding: ie I make everybody else richer while I hoard. The exact same thing is true about gold: any currency backed by gold gains real purchasing power.