4 ms·
You are responding to an off the cuff (and basically correct) remark with a deeply technical disagreement (that isn't incorrect either). Total money supply mea
by vorpalhex 4y ago
You are responding to an off the cuff (and basically correct) remark with a deeply technical disagreement (that isn't incorrect either).
Total money supply means that eg doubling the amount of liquidity does not double the price of items, but printing money can cause inflation on goods depending on where that printed money is absorbed. Making free money for building houses is different then sending a check to every American.. but in practice the Gov did the latter and now eggs are more expensive!
Where you add the money makes a big difference!
- ROTMetro 4y agoEggs are more expensive because of bird flu. It's funny but all the 'too much money in the system' people use examples that don't have that as a root cause. The guy with the lumber mill has no way of knowing if it was people with free money building additions, or, as in my area, EVERY business required to put in safety measures to stay open during covid most often made quickly with lumber from home depot that they have to buy no matter the price if they want the government to allow them to stay open. People claim it's too much free money when in fact they are getting windfalls from being basically 'rent seekers' while screaming they promote free market.
- vorpalhex 4y agoWe have a pretty good federally produced chart for inflation by sector: https://www.bls.gov/cpi/ https://www.bls.gov/cpi/ Unless you suddenly think "rent seeking" jumped right as the Government happened to start printing more money, it sure looks like inflation tracks quite nicely. Here's a nice investopedia breakdown of how printing money can cause inflation: https://www.investopedia.com/ask/answers/042015/how-does-money-supply-affect-inflation.asp https://www.investopedia.com/ask/answers/042015/how-does-mon...