> Everywhere is suffering inflation right now, including plenty of countries that didn’t do any QE or stimulus. It’s true the inflation is the US is higher over

> Everywhere is suffering inflation right now, including plenty of countries that didn’t do any QE or stimulus. It’s true the inflation is the US is higher overall, but looking at inflation trends historically that’s not unusual either. There’s just no good case that QE has ever had a big impact on inflation. If I try to abstract what you're saying here, what comes out is: you don't see any hard evidence for QE directly (yet not necessarily promptly) causing inflation. I assume we can agree upon the fact that apart from very few exceptions, in the last four decades just about all significant economies have seen massive increases in asset prices. See here: https://data.oecd.org/chart/6yZt https://data.oecd.org/chart/6yZt If the reason is not QE, then what else should have caused this? I know, inflation by the official definition explicitly excludes things like housing. So to make it clear, when I'm using this term I mean not only the CPI with its basket of goods but also housing and other assets. No, this "definition" doesn't match the official inflation numbers. But still, it doesn't make sense to just use the official inflation number that excludes one of the biggest chunks of people's expenses when you want to describe what's happening to prices. > Plenty of people like you were saying the same thing back in 2008. The huge stimulus would drive up inflation. In the real world it temporarily crashed below zero. Yeah, "official" inflation has been pretty low from 2008 up to 2020 ... housing and asset price inflation, not at all. The prices are exploding. Now there's people who just refer to the official inflation numbers to appease those who're worried about QE easing leading to rising prices. What they're doing is basically denying that rising asset prices will ever find their way through the chain of the economy down to consumer goods like food/clothes/whatever. But the rising prices do find their way through. Yes, it takes a good while but that's hardly surprising, because governments/markets/jurisdictions/societies/individuals/processes all have inertia and take time to react. But eventually they all react. Which means: inflation. Just a matter of time, not if. > The inflation we have now has nothing to do with predictions from before the pandemic. We’re you predicting that? I did of course not make a prediction back in 2015 that we would see significantly higher numbers of official inflation in 2021. But that's not the point. The point is that with continued QE, some time the inflation is going to happen. There's no way around it. That's what I am/was worried about. > Cash is seriously small time. All the big crime syndicates, especially drug cartels, but also people traffickers, phishers and ransom ware gangs user crypto heavily. Neither of us appears to have any numbers on this so this point is of little use. > What you’re forgetting is that everybody is part of the same economy. Not forgetting that at all. It's kind of synonymous to my claim that the monetary system is effectively a zero sum game. > You can’t have a world where companies collapse and workers thrive. If companies go down, their employees go down with them, and companies rely on finance. There are different kinds of companies. Some of which are quite far removed from the processes that actually generate the value. Say Blackrock for instance. Kind of like the hydrocephali of the economy. (Yeah, they have employees too they'd take down with them.) With the central banks' support they've done a decent job at making the whole world economy depend upon them, so they're holding states and central banks hostage now. If it weren't for that, they'd be pretty dispensable compared to the endless list of companies out there that produce actual value: fabric, food, plastics, metals, electronics, software, pharmaceuticals, and so on ... I guess we disagree here ;-) > That’s what QE is aimed to prevent happening. Yeah, sure it is. It's not going to work in the long term though. Ever seen an exponential system retain its exponentiality through all time? I say there's basically three possible outcomes for governments' increasing indebtedness: {A} More QE --> inflation --> monetary reform (somewhat likely) {B} Watering pot: central banks and governments supply money directly to people (not that likely) {C} Governments turn 180 degrees and start financing their budgets by imposing wealth taxes and such (rather unlikely) Hooray, let's see what'll have happened in 10 years :D creates reminder in calendar (set to 10 years) with link to this post