In truth rising prices are NOT inflation! In economics inflation is an increase in the amount of currency in circulation. Think of inflating a tire, pumping air into the tire is inflation, the fact that the car may be seen to rise slightly higher above the ground is the result of inflation. Likewise rising prices are the result of inflation, not inflation itself but prices may rise for other reasons. If some prices are going up and some down as we have had lately there may be inflation or there may not be. Prices may rise or fall due to a supply/demand change but if prices in general are rising it is most likely due to monetary inflation. Monetary deflation should cause most prices to fall.
What the government has done for years is to tailor the method of calculating cost of living to produce a lower official inflation rate without much regard for reality. Younger people are easier to fool with that kind of trickery, those who, like myself, are past seventy know the truth about the past. We have seen the time when whole families lived on a month’s income that only amounts to maybe one decent day’s pay or at most two days of mediocre pay now. I remember having a long conversation about what a person could do with three hundred dollars a week and coming to an agreement that no sane person could possibly ever have any real need for more money than that. Anyone but an incurable wastrel would live really, really well on half that and bank the rest.
And if prices are falling while the money supply is increasing, maybe demand for money is growing faster than supply.
The official definition of inflation is “too many dollars chasing to few goods”. I can remember my econ instructor repeating that over and over ad nauseum....
Yes. Inflation is a monetary phenomenon.