In response to Covid The Fed "goosed" the economy by "printing" a ridiculous amount of new dollars. That obviously devalued what was already in circulation.
Devalue === worth less Worth less === buys less
Voila...inflation.
The reason you / we don't understand is because no one - gov, Fed or media - wants the come clean on the impact of The Fed's Covid related decisions.
It literally exactly is.
> It's about your dollar having less value.
That’s exactly the same thing.
> The reason you / we don't understand is because no one - gov, Fed or media - wants the come clean on the impact of The Fed's Covid related decisions.
Almosf everyone (policy makers, media, outside observers) recogbizes and openly acknowledges that the recent inflation is largely a stimulus (mix of fiscal and monetary, though you focus on specifically the monetary part) overshoot from the extremely sharp but also extremely short, and with an extraordinary rapid bounce back, COVID recession. Trying to make this an “everyone is hiding it” conspiracy is... amusing, I guess, but not grounded in reality in any way.
The value of your dollar is *deflating*. And that's because where there used to be X there are now more of X. A lot more.
It's not a conspiracy theory when 99% of the time the narrative is "...it's the Russians and war..." or whatever BS they push and barely passing references to "oh btw The Fed flooded the money supply...again...and has devalued your dollars...effectively raising your taxes".
FFS stop with the hyperbole, stop being so naive, and stick to the facts. Please.
Yes, “the number of dollars I must give to get a fixed set of goods is larger” is exactly the same thing as “the number of things I can get for a fixed quantity of dollars is smaller”. General price increases and dollars being less are identical.
> It's not a conspiracy theory when 99% of the time the narrative is "...it's the Russians and war...
It wouldn’t be if that were true 99% of the time, but its not so, as you say:
> FFS stop with the hyperbole, stop being so naive, and stick to the facts. Please.
So it's The Russians? And The Fed's decisions have nothing to do with it? Come on now. Who aside from the masses is buying that?
And instead of tossing around cliches (e.g., conspiracy theories) just stick the facts. There's a narrative in the media and it doesn't mention The Fed. Funny enough, you seem to be championing that narrative. I can see w hy you're confused and lazily playing the cliche card. Good luck with that.
No, again, they are exactly the same.
> Because looking at it from the two different perspectives leads to two different conclusions.
It doesn't, though.
> So it’s The Russians? And The Fed’s decisions have nothing to do with it?
How do you get “it’s the Russians” and “the Fed’s decisions have nothing to do with it” from me saying, “Almost everyone (policy makers, media, outside observers) recognizes and openly acknowledges that the recent inflation is largely a stimulus […] overshoot from the extremely sharp but also extremely short, and with an extraordinary rapid bounce back, COVID recession”, again?
> Who aside from the masses is buying that?
No one is buying or selling the thing you are arguing against. (In fact, the Fed Chair has actually credit the Russian War in Ukraine with contributing to the same demand decline that the Fed is trying to engineer to fight inflation, not with causing inflation. [0])
> And instead of tossing around cliches (e.g., conspiracy theories) just stick the facts.
You are the one who has invented a conspiracy of coordinated false messaging that is divorced from the facts.
> There’s a narrative in the media and it doesn’t mention The Fed.
Where?
> Funny enough, you seem to be championing that narrative.
That’s defensible if you ignore…the only thing I said about the causes of inflation, and just go on pure fantasy.
[0] https://www.federalreserve.gov/newsevents/speech/powell20221...
Friedman made the argument that productivity (GDP growth per capita) has no effect on inflation, and interest rates just move where you choose to measure 0, hence his famous quote that "inflation is always and everywhere a momentary phenomenon" (paraphrased)
Also increasing productivity and technological progress should (and usually does)result in lower prices of goods.
Of course for things like cars or phones you end up paying the same or more for a superior product with more features, efficiency etc. instead.
https://www.schwab.com/learn/story/will-us-dollar-be-dethron...
Other currencies?
Certainly not in what it will buy in the USA.
Wages definitely are not driving inflation, wages will never keep up very well nor catch up.
Prices will never come down, except in unusual circumstances like overblown bubbles in market-based commodities where the market controls the value more so than underlying utility.
The problem comes with the fact that the US dollar being the global currency of trade, means that everything is originally priced in US dollars, so the strength or weakness of the US dollar does not change the price.
Furthermore the US is somewhat self-sufficient in terms of trade in key inflation areas such as food, so the dollar is ending up hurting exporters and reducing corporates profits.