04-09-2021, 01:56 PM
Inflation: Printing money does not cause it and you're using the word wrong anyway
<!-- SC_OFF --><div class="md"><p>This is an older article on from an econ professor that does an excellent job of explaining why the gut reaction to "omg there's more money, prices must go up" is not supported. The goal of printing money is to balance demand by encouraging entrepreneurs to make more stuff. </p> <p>The end has an excellent explanation for what led to the inflation of the late '70s-'80s. Basically, oil prices went up, production costs increased, and demand for cash increased from businesses to meet their needs until oil prices went down again. The money supply does not make prices go up or down on its own.</p> <p>Added bonus of an older article, it's fun to see that people were saying the same things in 2011 that they're saying now and we're able to see the results of those predictions 10 years on. <a href="https://www.forbes.com/sites/johntharvey/2011/05/14/money-growth-does-not-cause-inflation/?sh=5a79fe3e42f5">https://www.forbes.com/sites/johntharvey/2011/05/14/money-growth-does-not-cause-inflation/?sh=5a79fe3e42f5</a></p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/somethingClever344"> /u/somethingClever344 </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/mn2ac8/inflation_printing_money_does_not_cause_it_and/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/mn2ac8/inflation_printing_money_does_not_cause_it_and/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>This is an older article on from an econ professor that does an excellent job of explaining why the gut reaction to "omg there's more money, prices must go up" is not supported. The goal of printing money is to balance demand by encouraging entrepreneurs to make more stuff. </p> <p>The end has an excellent explanation for what led to the inflation of the late '70s-'80s. Basically, oil prices went up, production costs increased, and demand for cash increased from businesses to meet their needs until oil prices went down again. The money supply does not make prices go up or down on its own.</p> <p>Added bonus of an older article, it's fun to see that people were saying the same things in 2011 that they're saying now and we're able to see the results of those predictions 10 years on. <a href="https://www.forbes.com/sites/johntharvey/2011/05/14/money-growth-does-not-cause-inflation/?sh=5a79fe3e42f5">https://www.forbes.com/sites/johntharvey/2011/05/14/money-growth-does-not-cause-inflation/?sh=5a79fe3e42f5</a></p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/somethingClever344"> /u/somethingClever344 </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/mn2ac8/inflation_printing_money_does_not_cause_it_and/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/mn2ac8/inflation_printing_money_does_not_cause_it_and/">[comments]</a></span>Kind Regards R