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Printing money only leads to inflation, if it ends up in hands that spend it, which didn’t really happen. We have massive supply side issues though: extreme ga

• mike_hearn 4y ago
  It's both: the UK printed money on a vast scale and then gave it directly to people via cash transfers, whilst simultaneously shutting down things it might have got spent on. It was being handed out so easily that they estimate £17 billion were lost to fraud alone. Spending on furlough was approx £70bn, and the population of the UK is only officially 67.3 million so that was basically cash handouts of ~£1000 to every single man woman and child in the country. As a consequence, savings broke records over the pandemic period [1]. Now restrictions are gone that money is flooding into the economy as everyone tries to buy things. Simultaneously supply chains are still recovering and energy/gas supplies are limited, this is true. Nonetheless, you can't print thousands of pounds per person and not expect that to create large price increases. [1] https://www.ons.gov.uk/economy/nationalaccounts/uksectoraccounts/articles/economicmodellingofforcedsavingduringthecoronaviruscovid19pandemic/2022-06-06#:~:text=Using%20an%20econometric%20model%20of,of%20annual%20household%20disposable%20income https://www.ons.gov.uk/economy/nationalaccounts/uksectoracco....