""If the 1970 economy had been deflated like the American economy of 1940 there would have been no inflation.""
that is the most nonsensical statement ive ever heard.
"'Tell me, does the money supply magically increase itself ? Or does it increase because the government is taking on massive new responsibilities and is financing it with the printing press?""
youre very confused between fiscal and monetary policy. I wont give you a history lesson on the 1970s cuz you wouldnt understand it and I am sure youve never heard of Arthur F Burns.
But I will tell you today we are having increasing inflation because back in 2001-03 Greenspan was fighting deflation or preceived deflation by jacking up the MS. We do not have increasing inflation due to budget deficits.
In 1980 inflation was about 15% and the budget deficit was 2% of GDP.
In 1983 inflation was 3% and the budget deficit was 6% of GDP
do you understand the significance of this? It is your argument has just been shot out of hte water
How silly you are !
In 1980 oil was expensive.
In 1983 oil prices had halved from 1980.
Not to mention that nasty recession that stretched from 1980 to 1983 precisely to crush demand inflation. You see, when the interest rate is 18% people stop buying things.
You seem to be incapable of understanding that demand can come from the public and business and/or government.