Finance

Inflation is to much money chasing to few goods. To bring inflation down you must destroy money. As our system works issuing debt is money creation because that money does not exist. When you pay that debt off that money is destroyed. Where does the 100k to buy your house come from? Grandma, grandpa, and bob down the street putting 10k in the bank. The other 90k is created out of the ether due to fractional reserve banking. You are hoping that you can pay it back and that the economy will grow and keep you in a job to pay it back. Eventually though this shaky house of cards will all collapse. Higher rates slow inflation because companies would rather not borrow and grandma can put her money in "safex treasury bills instead of lending it to uber who loses money on a yearly basis without fail