I agree this can lead to inflation, but the 90's kept it solid even with the boom, right?

The problem with this cycle: wage increase -> cost of labor increase -> goods increase -> wage increase -> inflation is, and here's where I get all Che, a fundamental problem with capital. Unless only some people see their wages increase, it keeps a lid on inflation, because there will always be exploitable labor.

So I go back to the late 1990's: why did the economy boom and wages rise without inflation? Simple: the notion of labor increases driving inflation ignores the fact that very very rich people are taking the bulk of the profits and if they weren't so intent on taking every last penny, then labor costs would NOT be passed on to the consumer.

As long as CEOs feel entitled to unlimited pay, there will always be inflation.