This group has many math nuts, so I thought I'll post it here too. A mathematical consequence of debt-based fractional reserve monetary system is that inflation and money supply will grow exponentially, even if this exponential growth rate is "small." As time is infinite, borrowing from the future is also infinite (You can always borrow from generations farther and farther in the future to pay for Ponzi Medicare and Ponzi Social Security). Money supply and credit are mathematical constructs that exist in banks' computer memories and they can be infinite. Consequently, cost of all things will increase exponentially with time. It makes no difference to a human being to ingest 2000 Calories a day in the year 2010 or in the year 1900; it is the same daily energy requirement; the only difference may be that in 1900, the cost of 2000 Cal was 5 cents and in 2000, 20 dollars. The cost is a mathematical construct and has little material meaning as long as people have comparable means to obtain credits to purchase 2000 Cal of food (or other items). If the amount of labor to procure $20 in 2010 is the same as the amount to procure 5 cents in 1900, life is not worse off due to inflation and expansion of money supply or debt. Only the carrying capacity of the physical world can limit the insanity of exponential population and credit growth.

As long as someone is responding to your post, maybe they can answer this related question as well: Who decided that maintaining an approx. 2% inflation rate is a good idea? It is no wonder the savings rate in this country was terrible for so long; If you don't spend as much as possible, there is no way to know how much your savings would be degraded due to the harmless "inflation tax".