"the idea that inflation is only about the money supply is all wrong and completely unhelpful in understanding recent inflation." paulkrugman.substack.com/p/inflation - ThreadSky

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ryanlcooper.com • 15 days ago

"the idea that inflation is only about the money supply is all wrong and completely unhelpful in understanding recent inflation." https://paulkrugman.substack.com/p/inflation

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thesoundings.bsky.social•15 days ago

as Krugman would say, the inflation-money supply link is another zombie idea that won't die.

james-kaber-00.bsky.social•14 days ago

Inflation, by definition, is the rise of prices. Period

katiecannon.bsky.social•14 days ago

Demand pull inflation is when too much money is chasing too few goods

Then there’s lots of other reasons for higher prices

From tariffs to monopoly pricing power, etc

kickitty.bsky.social•15 days ago

anybody remember the program "Junior Achievement"?

I believe it was there I heard the adage of inflation being too much money chasing too few goods, and that made sense to me (30+ years ago)

yukonhcornelius.bsky.social•15 days ago

Inflation is always too much money chasing too few things across various sectors. Unless there are policy errors at work (production restricted, money supply increased, etc) it solves itself.

The 1970s inflation had massive policy mistakes. Trump admin seems like it will make a few as well.

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