What’s your theory on what is causing inflation?
I like Stephen Moore and he basically states it’s the same thing. Too many dollars....the printing presses working overtime.
If the US money supply is the cause of inflation, why is there inflation in the rest of the world as well? If you look at the actual M2 Fed statistic it has been flat since February 2022 so why are prices still increasing?
Some inflationary periods are caused by Federal spending that exceeds the productive capacity of the real economy causing people to chase scarce goods.
In 2020 the government shut down much of our productive capacity for COVID while increasing the money supply dramatically to pay workers to stay home. This disrupted the supply chain artificially and drove up prices on goods that were scarce. Current inventories are at record levels and these goods will have to be discounted by retailers to clear their shelves which is deflationary. The Ukraine War and Biden’s energy shutdown drove up fuel, fertilizer, and food costs world wide adding to the inflation.
Bottom line, not all inflation has the same causes and the monetarists are fighting the last war with the only weapon they understand, crush wage earners and drive up interest rates. Its a cruel mistake.