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Doesn't monetary economics also point out that various goods, services and assets have differing rates of inflation/deflation? Is there any danger of a K-shape
by aeternum 6y ago
Doesn't monetary economics also point out that various goods, services and assets have differing rates of inflation/deflation?
Is there any danger of a K-shaped recovery in which the fed is forced to accept massive inflation in parts of the economy in order to prevent deflation in others?
Has the wealth gap and ensuing social unrest caused by this bifurcated inflation historically caused nations to fall?
- whimsicalism 6y ago> Doesn't monetary economics also point out that various goods, services and assets have differing rates of inflation/deflation? Inflation is an increase in prices as money becomes worth less. "Differing rates of inflation/deflation" are just the price system at work. Since during Covid, velocity decreased, inflation dropped substantially, which required an increase in base in order to prop back up inflation. > Has the wealth gap and ensuing social unrest caused by this bifurcated inflation historically caused nations to fall? The wealth gap is not caused by "bifurcated inflation." It is caused by rapidly rising equity prices, among other things, but that is not the same thing as inflation.
- aeternum 6y agoThe fed generally uses PCE to measure inflation which does not include equities. Suppose that for every dollar the fed prints, 95 cents ends up in equities and 5 cents ends up in PCE. We can argue about what to call it but that doesn't change the outcome.