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“Inflation has multiple sources; everytime you ask for a raise, everytime OPEC cuts oil production, evrytime a tax is raised, or some one borrows to get that (whatever) they have to have now instead of saving for it — all of these things cause more money to chase after the same (or less) stuff.”

If your theory is correct, then Obama did nothing wrong in printing a few trillion for the TARP.

Your causes of inflation seemed to not cause inflation before the Fed combined with Progressive governments. Inflation was almost unknown the first 120 years of America. Prices for goods, land, services were very consistent as time rolled on. And in 1900, we had the highest standard of living on earth, by a factor of four to the nearest competitor.

The simple fact is, the progressives needed the ability to “run” the currency. The recent example. Obama prints up a trillion for TARP and bailed out banks in Germany England, and elsewhere in Europe. If he had to lay taxes to bail out a European bank, things like this could not occur.

If you are a global economy type, you love a currency that has no meaning. You hate a currency that has meaning. And a currncy with meaning also causes rational governments to be held to a standard lest their imaginary money suffer falling exchange rates. A fiat currncy is the tool of the statist, it certainly isnt the cause of wealth.

You may want to rethink what you believe currency actually is. As a medium of exchange, electrons do just fine. And they are a lot easier to carry around then shiny metal.

Here is another part of the puzzle overlooked by the metal fiends. For the first 100 years of this nation’s existence, most of the population was engaged in what we would consider today to be subsistence farming. Once machinery started to increase the worker’s productivity, higher wages could be paid, but the pool of available goods did not always keep pace.

One of the reasons why wages did not go up from 1780 to 1900 was because MOST of the workers economic output (what economists call “productivity”) was about the same at the end of the period as it was at the start. Plus, the pool of avavilable goods to buy was just starting to increase around then, but was roughly the same as in 1780.

Now the TARP issue is a seperate argument and I did not directly speak to that in my discussion of the chart. That money is not really circulating........yet. It MIGHT — see my comment on borrowing and what that does to the money supply. As for whether it was right or wrong, I will offer my opinion — we survived the inflation of 1973 - 1983. I am fairly certain we would not have survived the collapse of the banking system. BTW, it was Bush that got TARP rolling. Obama’s contribution to any future inflation will be Porkulus.