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Is it really odd to measure relative to the actual natural base rate of inflation, which is negative in a healthy economy, instead of ignoring opportunity cost
by danenania 16y ago
Is it really odd to measure relative to the actual natural base rate of inflation, which is negative in a healthy economy, instead of ignoring opportunity cost and arbitrarily assigning zero as the base rate? If an economy's natural rate of inflation would be -3%, but government monetary expansion keeps it at zero, are you just going to pretend there's no inflation?
- yummyfajitas 16y agoYou seem to wish that "inflation" was defined as "monetary expansion". It isn't.
- danenania 16y agoSome economists do define it that way, but that wasn't my argument. However, I do see your point if we define inflation as strictly the rise in prices, which certainly is the most common definition. My reasoning was off.
- deleted 16y ago[deleted]