Is increased buying power the actual cause of inflation? Or is it disruption in China? Or is it executives choosing to take profits because they can (for some particular reason)?
What evidence could be used to distinguish between the various possibilities? I don't actually know, and I'm curious.
One such metric would be Chinese export volumes, in ships and containers. Apparently container ports are clogged in USA.
Im sure its a multitude of factors but it is definitely the increase spending due to government intervention. Aggregate demand is several years above trend.
Money supply has not been shown to increase inflation in recent decades. Supply chain issues have.
Would love to read more about this because my understanding is that the increase in M2 money supply is a big part of the current inflation (very simplified - it's way more complex when looking at money velocity and supply chains in general).
Exactly. It's obvious how printing money out of thin air induces inflation.
Current inflation is mostly supply-side driven. Having said that, M2's biggest jump in its history was in early 2020 (see https://fred.stlouisfed.org/series/M2SL). Its slope before and after is more or less the same. However, I don't think inflation will lag it by more than a year.
My rent went up $300 a month...is that supply-side driven?