Inflation

The general rise in prices over time, which reduces how much a given amount of money can buy.

Example

If prices rise 3% a year, something that costs $100 today costs about $103 a year from now.

Cash that is not invested loses purchasing power every year inflation is positive, even though the number in the account never goes down.

Real return — An investment's return after subtracting inflation - what you actually gained in purchasing power.
Purchasing power — What a given amount of money can actually buy.
Nominal return — An investment's return in raw currency terms, before adjusting for inflation.

The nominal safety that loses money anyway — The balance cannot fall, and that is exactly why the real risk in this class is invisible. Inflation reduces what the money buys, and the tax is levied on the nominal interest rather than on what you actually gained. (13 min)
No earnings, no dividends - just relative rates, inflation and flows — A currency has no cash flow to value. Its price reflects interest rates, inflation, trade and capital flows and sentiment, and forward prices are set mechanically by interest rate differences. (11 min)
Cash is a decision, not the absence of one — Holding cash has a cost measured against what else the money could earn, and a value in optionality and sleep. Sizing it deliberately is part of portfolio construction rather than what is left over. (10 min)
A real asset with a flattering picture of itself — Property earns its place through contracted income from a physical thing, driven by different forces from a share. But its low measured volatility is partly an artifact of being appraised rather than traded, and that artifact has a size you can compute. (9 min)
Inflation and real returns — A return that beats zero isn't automatically a good one. It has to beat inflation first, or your money is quietly shrinking while the balance grows. (9 min)