The tyranny of inflation targeting:

The government only cares about the core CPI.  The core CPI is the average of a lot of stuff that increases in price & a lot of stuff that decreases in price.  The government doesn't care if 1 thing goes up 50%, as long as something else goes down & the average is 3.5%.  

Human productivity is always increasing.  Something is always getting cheaper, so in order to avoid deflation, the government converts debt to cash, increases the money supply & raises the price of something else to hit 3.5%.  The more productivity increases & something gets cheaper, the more something else has to go up in price to hit 3.5%.  Productivity is the basic fuel which feeds the government. 

What typically went down in price for the last 100 years was electronics.  What typically went up to compensate was housing.  Inflation targeting creates a paradox where there's an incentive to produce less in order to reduce prices.  If the price of electronics goes up, the government will reduce the money supply, convert debt into bonds, to cause the price of housing to go down & hit 3.5%.

We saw the paradox when the government lowered the price of houses, slightly, to offset the rise in price of electronics in 2022, which was caused by China ceasing all production for 3 years.  To reduce the price of housing, produce less electronics.  When the government made its disinflation call, the price of houses was still 300% higher than 3 years earlier, but they only prioritized the average.

It's also a game, since the stuff that tends to drop in price tends to be stuff no-one needs.  We've all heard the phenomenon of bullshit jobs.  Most jobs involve producing stuff no-one needs so that's where the productivity growth is.  If the price of things you don't need goes down, the price of things you do need has to go up.  The price of things you need will always rise faster than 3.5%.

Inflation targeting is the reason the stonk market has always been a good long term bet.  Stonk is typically the thing which the government inflates to counteract higher productivity.  The worst think that could happen to stonks is the end of inflation targeting.  Ending inflation targeting could lead to a nikkei 225 scenario & would dramatically change investing.  Lions doubt it'll happen suddenly, but it might happen gradually.