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ZIRP wasn’t without inflation, it was just limited to financial assets - look at housing supply worldwide, equities, bonds, art, etc etc. This became a problem
by voisin 3y ago
ZIRP wasn’t without inflation, it was just limited to financial assets - look at housing supply worldwide, equities, bonds, art, etc etc. This became a problem in the latest round of money printing when that inflation finally spread into CPI and affected food and other necessities (though housing is a necessity and people have been screaming about that for two decades as it continued to rocket higher…)
- dragontamer 3y ago> ZIRP wasn’t without inflation, it was just limited to financial assets By that definition, the 1990s were a period of great inflation. Which is... not what that word means. > “When I use a word,’ Humpty Dumpty said in rather a scornful tone, ‘it means just what I choose it to mean — neither more nor less.’ > ’The question is,’ said Alice, ‘whether you can make words mean so many different things.’ > ’The question is,’ said Humpty Dumpty, ‘which is to be master — that’s all.” ------------ When financial assets go up in value, that's normally called a "bull market" by the way. Not "inflation". Changing the definition of "inflation" to match your preconceived theories of how the economy works is... pretty much what Humpty Dumpty does in the Alice-in-Wonderland series.
- scrlk 3y agoZIRP in the 2010s didn't lead to price inflation (CPI), but I think there's a very strong argument to be made that it lead to asset price inflation [0]. [0] https://en.wikipedia.org/wiki/Asset_price_inflation https://en.wikipedia.org/wiki/Asset_price_inflation