Chapter 46: Making Big Money and Going on a Date
Chapter 46: Making Big Money and Going on a Date
The small-loan business was booming.
Federation citizens had abandoned the habit of saving money, or rather, years of rapid economic growth had shifted their mindset toward spending instead of saving. In the past, people did save, but with the booming economy, experts constantly reminded them: money left sitting in the bank would depreciate.
Five years ago, when people earned only twenty dollars a month, fifteen dollars could buy a bicycle. Now, a bicycle cost more than twenty dollars. That five-dollar depreciation reflected inflation, making saving seem futile. Spending promptly was seen as a way to maintain the value of one’s wealth.
A bicycle purchased for fifteen dollars five years ago could now sell for seven or eight dollars in the second-hand market—essentially, one dollar per year for riding it.
You couldn’t say the experts were wrong; their examples were valid. As the economy flourished, more cash circulated in the market, and the Federation printed more money to meet demand, leading to price changes.
However, to say they were entirely correct wasn’t accurate either. Measured by purchasing power, spending three-quarters of one’s monthly income versus half showed the actual value of goods like bicycles was declining.
But people didn’t care about that; they only saw that bicycles had become more expensive.
This mindset of living for the moment, coupled with a proliferation of finance companies offering installment plans and loans, nurtured a culture of immediate consumption. It also fueled the Federation’s rapid economic growth. Factories never lacked customers for their products, and experts predicted this economic prosperity would last another ten years or more.