Source img:https://economipedia.com/definiciones/ilusion-monetaria.html
In this section, we are going to touch a deceptive concept for many beginners in economics. That idea is the monetary illusion, financial mirage that convinces us to have more money than is really available.
Imagine for example: you have a deposit that rents you 7% interest. A priori it seems a good figure, life insurance considering that your country has an inflation of 10%. Insurance? Are you really making money? Let's take a look.
If inflation is 10% and your profitability of 7% ... you are really earning money that loses value with respect to inflation, with which, your savings are devalued and your purchasing power decreases.
Another thing would be that instead of an inflationary scenario we had a deflationary one, where that 7% would be more than juicy considering the fall in prices in the economy.
