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This isn’t rocket science. At least 20% of all dollars that have ever existed were created this year. It’s inflation. This is also why Bitcoin is peaking. It’s

This isn’t rocket science. At least 20% of all dollars that have ever existed were created this year. It’s inflation. This is also why Bitcoin is peaking. It’s really interesting to me that media outlets like the NYT continue to obscure this fact. For those who don’t believe me check out how the dollar has declined relative to other currencies. I’m not making this up: https://www.reuters.com/article/uk-global-forex/more-weakness-seen-as-dollar-posts-worst-year-since-2017-idUSKBN29501M https://www.reuters.com/article/uk-global-forex/more-weaknes...

wazoox 6y ago
Exactly. Dollar is declining quite fast in value against the Yuan, particularly if you take into account base rates.
soared 6y ago
The consumer price index shows it isn't inflation. This is 20 years of data and you can click each basket to see it on the graph. "ALL" is up 1% YoY. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm https://www.bls.gov/charts/consumer-price-index/consumer-pri... The only item baskets I found with recent increases are food, new vehicles, and medical care.
- CyberRabbi 6y ago
  The immediate price of goods isn’t the only measure of inflation. The fact is that the supply of the dollar has exploded. https://www.cnbc.com/2020/12/31/forex-markets-dollar.html https://www.cnbc.com/2020/12/31/forex-markets-dollar.html
  - SpicyLemonZest 6y ago
    Inflation is by definition an increase in prices. The amount of money in the economy is called the "money supply". Some economists do argue that the money supply is the primary factor in determining inflation, but that's very different than saying that increases in the money supply are inflation, because the need for money in the economy (usually expressed in terms of the "velocity of money") can vary.
    - CyberRabbi 6y ago
      Prices of goods have different dynamics than the prices of assets. If you don’t understand how money supply relates to inflation I simply don’t know how to engage with you on this topic.
      - SpicyLemonZest 6y ago
        Respectfully, I'm not sure there's much point in proposing an uncommon heterodox theory if you can't engage with people who have a conventional understanding of the topic.
        CyberRabbi 6y ago
        There is nothing heterodox about the concept of supply-side inflation
      - brazzy 6y ago
        Consumer price inflation is a different thing than asset price inflation. The point you seem to be missing is that when you only say "inflation", it's by very widely dominant convention assumed to be consumer price inflation.
    - KingMachiavelli 6y ago
      > Inflation is by definition an increase in prices. Sure, I think everyone agrees on that but the CPI only measures a vary narrow range of goods and weights them such that it ends up ignoring some very obvious trends. Most of the inflation could simply by accounted for by the drastic rise in stock prices, real estate values, etc. Even though the CPI/Fed doesn't care about those segments with regards to inflation does not mean it is not inflation.
      - harryh 6y ago
        CPI only measures a vary narrow range of goods The basket of goods used to calculate CPI includes thousands of items covering all categories of consumption by US consumers. It includes housing, energy, education, health care, consumer staples, durable goods, etc.
- turbinerneiter 6y ago
  The consumer price index is a joke. House prices doubled and the consumer price index shows low inflation for the same period. I don't care about the price of a smartphone or whether spaghetti became 10 cents more expensive. I care about whether or not I will be able to afford a house through a lifetime of work. And it's looking bad at that front. I'd literally have to pay back debt for longer than I still have to work before retirement.
  - SpicyLemonZest 6y ago
    The consumer price index is an average over an economy with a bunch of heterogenous goods, and a bunch of people who care different amounts about different subsets of them. I tend to agree that cheap housing is more important than cheap spaghetti or cheap iPhones, but that doesn't mean the CPI is wrong; it's just measuring something different than the details of what an optimal household budget ought to look like.
  - harryh 6y ago
    If you believe that inflation is actually much higher than is generally believed by the public/markets you shouldn't care so much about mortgage payments > 10 years from now on a loan with fixed payments. The huge inflation you expect will mean the real cost of these payments dwindle in size so they will matter very little to you.
    - paganel 6y ago
      The issue is of course that the salaries/wages don't get raised as much as the other costs mentioned by the OP (housing, among others, I'd add education), they haven't done so for quite a long time now. In order to be able to have "real cost of payments" going down because of inflation you'll still need some down-payment or some basic proof that you'll be able to pay back the loan you're about to get, and those stagnating wages often times are not enough for that.
      - harryh 6y ago
        When a subset of goods are rising in price at a faster rate than other goods you aren't really talking about inflation anymore. You're talking about something else. It's pretty important to recognize the distinction.
- ericd 6y ago
  There are multiple types of inflation. Asset inflation is what your parent is talking about, which is not well reflected in the CPI. Any product/service with domestic labor as a primary input (healthcare, education, childcare, construction, professional services) has seen much higher inflation.
IAmGraydon 6y ago
What are your thoughts on this chart? Hit 25Y for more perspective. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi
- CyberRabbi 6y ago
  My thoughts are that consumer goods prices respond differently to sudden surges in the money supply than asset prices.
  - deleted 6y ago
    [deleted]
robjan 6y ago
If that were the reason for Bitcoin peaking then Bitcoin would be correlated with other stores of value, such as gold. Since they aren't correlated either gold is massively underpriced right now or this run on Bitcoin is for another reason.

wazoox 6y ago

Exactly. Dollar is declining quite fast in value against the Yuan, particularly if you take into account base rates.

soared 6y ago

The consumer price index shows it isn't inflation. This is 20 years of data and you can click each basket to see it on the graph. "ALL" is up 1% YoY. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm https://www.bls.gov/charts/consumer-price-index/consumer-pri... The only item baskets I found with recent increases are food, new vehicles, and medical care.

CyberRabbi 6y ago
The immediate price of goods isn’t the only measure of inflation. The fact is that the supply of the dollar has exploded. https://www.cnbc.com/2020/12/31/forex-markets-dollar.html https://www.cnbc.com/2020/12/31/forex-markets-dollar.html
- SpicyLemonZest 6y ago
  Inflation is by definition an increase in prices. The amount of money in the economy is called the "money supply". Some economists do argue that the money supply is the primary factor in determining inflation, but that's very different than saying that increases in the money supply are inflation, because the need for money in the economy (usually expressed in terms of the "velocity of money") can vary.
  - CyberRabbi 6y ago
    Prices of goods have different dynamics than the prices of assets. If you don’t understand how money supply relates to inflation I simply don’t know how to engage with you on this topic.
    - SpicyLemonZest 6y ago
      Respectfully, I'm not sure there's much point in proposing an uncommon heterodox theory if you can't engage with people who have a conventional understanding of the topic.
      - CyberRabbi 6y ago
        There is nothing heterodox about the concept of supply-side inflation
    - brazzy 6y ago
      Consumer price inflation is a different thing than asset price inflation. The point you seem to be missing is that when you only say "inflation", it's by very widely dominant convention assumed to be consumer price inflation.
  - KingMachiavelli 6y ago
    > Inflation is by definition an increase in prices. Sure, I think everyone agrees on that but the CPI only measures a vary narrow range of goods and weights them such that it ends up ignoring some very obvious trends. Most of the inflation could simply by accounted for by the drastic rise in stock prices, real estate values, etc. Even though the CPI/Fed doesn't care about those segments with regards to inflation does not mean it is not inflation.
    - harryh 6y ago
      CPI only measures a vary narrow range of goods The basket of goods used to calculate CPI includes thousands of items covering all categories of consumption by US consumers. It includes housing, energy, education, health care, consumer staples, durable goods, etc.
turbinerneiter 6y ago
The consumer price index is a joke. House prices doubled and the consumer price index shows low inflation for the same period. I don't care about the price of a smartphone or whether spaghetti became 10 cents more expensive. I care about whether or not I will be able to afford a house through a lifetime of work. And it's looking bad at that front. I'd literally have to pay back debt for longer than I still have to work before retirement.
- SpicyLemonZest 6y ago
  The consumer price index is an average over an economy with a bunch of heterogenous goods, and a bunch of people who care different amounts about different subsets of them. I tend to agree that cheap housing is more important than cheap spaghetti or cheap iPhones, but that doesn't mean the CPI is wrong; it's just measuring something different than the details of what an optimal household budget ought to look like.
- harryh 6y ago
  If you believe that inflation is actually much higher than is generally believed by the public/markets you shouldn't care so much about mortgage payments > 10 years from now on a loan with fixed payments. The huge inflation you expect will mean the real cost of these payments dwindle in size so they will matter very little to you.
  - paganel 6y ago
    The issue is of course that the salaries/wages don't get raised as much as the other costs mentioned by the OP (housing, among others, I'd add education), they haven't done so for quite a long time now. In order to be able to have "real cost of payments" going down because of inflation you'll still need some down-payment or some basic proof that you'll be able to pay back the loan you're about to get, and those stagnating wages often times are not enough for that.
    - harryh 6y ago
      When a subset of goods are rising in price at a faster rate than other goods you aren't really talking about inflation anymore. You're talking about something else. It's pretty important to recognize the distinction.
ericd 6y ago
There are multiple types of inflation. Asset inflation is what your parent is talking about, which is not well reflected in the CPI. Any product/service with domestic labor as a primary input (healthcare, education, childcare, construction, professional services) has seen much higher inflation.

IAmGraydon 6y ago

What are your thoughts on this chart? Hit 25Y for more perspective. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi

CyberRabbi 6y ago
My thoughts are that consumer goods prices respond differently to sudden surges in the money supply than asset prices.
- deleted 6y ago
  [deleted]

robjan 6y ago

If that were the reason for Bitcoin peaking then Bitcoin would be correlated with other stores of value, such as gold. Since they aren't correlated either gold is massively underpriced right now or this run on Bitcoin is for another reason.