Two minor quibbles: M1 has exploded largely due to a simple accounting change post covid: savings accounts which used to only be included in M2 are are now counted in M1, driving that number way up regardless of fiscal policy. That in itself cannot “push prices higher”. ”Extreme” monetary measures are then quoted as being one of the two factors for driving inflation but the previous Monopoly section rightly showed that monetary policy has not been able to cause inflation as the Fed’s money printing, namely reserves generated by QE. has not and cannot get into consumers’ hands. It stays completely in the inter-banking system. Inflation now is fiscal policy all the way down.
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Two minor quibbles: M1 has exploded largely due to a simple accounting change post covid: savings accounts which used to only be included in M2 are are now counted in M1, driving that number way up regardless of fiscal policy. That in itself cannot “push prices higher”. ”Extreme” monetary measures are then quoted as being one of the two factors for driving inflation but the previous Monopoly section rightly showed that monetary policy has not been able to cause inflation as the Fed’s money printing, namely reserves generated by QE. has not and cannot get into consumers’ hands. It stays completely in the inter-banking system. Inflation now is fiscal policy all the way down.
Post: Whither Inflation?
Link to comment from August 7, 2021