> In order for prices to rise generally, there has to be an increase in the money supply relative to the goods and services it represents. That's not true, eve

> In order for prices to rise generally, there has to be an increase in the money supply relative to the goods and services it represents. That's not true, even with simplistic models like supply and demand curves. Prices can rise across the board with a fixed money supply, and you'll have a corresponding reduction in amount of goods traded. Yesterday 1000 people each bought 2kg of potatoes at $1/kg, and 1 kg of meat at $10/kg. Today, potatoes cost $2/kg, and meat costs $15/kg. So, 800 people buy 3kg of potatoes and 0kg of meat, and only 200 people keep buying both potatoes and meat. Meat producers adjust their production down to account for the new conditions, firing extra staff and sending the spiral ever downward.