Correct. ^^^ Savers and fixed income ppl are doomed with inflation and debtors rejoice. This is why major companies carry at least some debt and expand or buy other companies... instead of just purely buying bonds and building up cash reserve with their profits. They are playing all sides: inflation/deflation, good/bad economy. They win regardless. Working people and companies do with ok with inflation since their wages or prices can just rise. The retired people are the ones really smashed. As was said, money being in the bank or under a mattress doesn't matter much, though... it all loses substantial buying power in a hurry during inflationary times. If inflation or hyper occured, you would want to spend any currency you had asap ("cash is trash") for non-perishables or something that will enhance your productivity and future earning power or something that can preserve the buying power. By the time most ppl realize that, it is usually too late, though. Good luck buying gold once at a fair price in that currency once inflation is rockin and rollin. ...That is what I kinda view gold (and to a lesser extent, silver) as: basically a world money and store of wealth. I imagine my gold as a big mixed pile of various countries' paper currency that also keeps up with inflation (over time, but not necessarily day-to-day). You can sell a gold coin or bar in basically any region of the world for fair value, and that is pretty damn nice. It is interesting to consider your gold's value not so much in paper numbers... but in buying power. How many ounces of gold to buy a decent car? To buy a house? To buy a year's groceries? Those figures tend to hold up, and they aren't affected too much by inflation.