The Lie That Savings Are Safe: Will Inflation Melt Away Your Assets? Survival Strategies to Protect Your Family from the “Silent Bank Freeze”

“Keeping money in the bank is safe”
That common belief may be crumbling before our eyes.

The reality facing “Dad with a ¥3 million annual income” is far from someone else’s problem.
We’ll explain the true nature of the “quiet deposit freeze” created by rising prices (inflation) and distorted interest rates, and the immediate steps we should take.

1. The True Nature of the “Silent Deposit Freeze”: Why Does Simply Holding Cash Lose You Money?

In Japan’s past, cash was the ultimate safe asset.
However, in today’s era of accelerating inflation, “holding onto cash” equates to nothing less than “the risk of continuous value erosion.”

Negative Real Interest Rates Erode Your Assets

For example, if prices rise at an annual rate of 4% but your bank deposit interest rate is only 2%, your asset value is eroded by that 2% difference.
Even if you deposit 1 million yen, after one year, you can only buy goods worth 980,000 yen… This is the “real loss of assets.”

Inflation is a “miracle cure for debt repayment” for governments

Why is this situation allowed to persist?
In reality, inflation has a “convenient” aspect for governments burdened with massive debt.

• Real Debt Reduction
  When the value of money declines, the government’s debt also becomes substantially lighter.
• Hidden Tax
  Direct tax hikes provoke backlash, but inflation-driven asset depreciation functions as a “quiet bank freeze,” indirectly siphoning wealth from citizens.

2. The Illusion of Controlling Prices and the Threat of FTPL

It is dangerous to assume that “if inflation occurs, the government will handle it.”
While there is hope placed in Modern Monetary Theory (MMT), reality is not so forgiving.

Politically, “Raising Interest Rates and Taxes” is Difficult

In theory, raising taxes or interest rates (spending cuts) is effective for curbing inflation.
However, for politicians facing elections, decisions that impose pain on the public are extremely difficult.
As a result, countermeasures often lag behind, creating the risk of accelerating inflation.

The Future Suggested by FTPL (Fiscal Theory of Price Levels)

Here, the concept of FTPL (Fiscal Theory of Price Levels) becomes crucial.

“Prices are determined not only by the quantity of money but also by the government’s fiscal discipline.”

If the market begins to doubt whether the Japanese government can repay its debts in the future, confidence in the yen could collapse, potentially triggering a hyperinflationary currency crash.

3. Paradigm Shift: From “Protecting” Cash to “Investing” It

We now stand at a major turning point in history—a paradigm shift.
This is an era where “not taking risks becomes the greatest risk.”

Questioning the Trustworthiness of the “Yen” Currency

Considering the Japanese government’s fiscal situation, concentrating assets solely in Japanese yen is like “putting all your eggs on one horse.”
If the yen weakens further, Japan’s import-dependent prices will rise even more.

An “Offensive” Stance to Protect Assets

It is no longer possible to protect assets by relying solely on deposits.

• Diversification into tangible assets
  Assets resilient to inflation, such as real estate and gold.
• Shift toward investments
  Portfolio management that counters currency depreciation, including stocks and foreign currency-denominated assets.

To “defend,” you must also invest “offensively”—this is the modern survival strategy.

Summary: Cash is no longer a “safe asset.”

Governments are attempting to manage their debt by effectively eroding the real value of citizens’ savings through inflation.

It’s time to graduate from the complacent mindset that “just having savings is safe” and learn how to protect your assets yourself.

This should be the first step for the “3-million-yen-a-year dad” to carve out his path to becoming a millionaire.