Prof G Markets · Thursday, September 3, 2026
Inflation serves as a key mechanism for countries to manage their debt, according to an investment expert. By inflating the currency, nations can repay their debts with less valuable dollars, effectively acting as a tax on the global population and a form of deleveraging.
“No doubt. I mean, look, I mean, the debt continues to expand. Uh, but, uh, if you think about how we deal with, uh, debt and, uh, the modern economy, it's inflation.”
“I mean, the reality is that we repay our debt with many dollars because the dollar and all currencies continue to appreciate over time.”
“So, the way that it's paid for is through inflation. It's the most insidious tax on the global population that has ever been invented.”
“And so, you know, when you think about the budget deficit, it's a function of, you know, the dollars you spend versus the dollars you bring in. So, you know, you can tax to pay for it, you can borrow to pay for it. You can print to pay for it. But, uh, you know, the reality is that if you have inflation, you essentially pay down your debt with cheaper dollars.”