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Inflation is a rise in the general level of prices, more money in the economy causing the value of the dollar to reduce in value can be one cause of inflation. There are various ways to measure this like the consumer price index

Things like printing money are often said to cause inflationary pressure.

Inflationary pressure can be caused by several factors such as fiscal policies, demand-pull inflation, cost-push inflation, disproportionate minting of money compared to the industrial output and demand for goods and services, increases in production costs such as raw materials and wages, a surge in demand for products and services, different variables or disruptions that push manufacturers to adjust and respond to ever-changing supply-demand economic conditions

https://www.wallstreetmojo.com/inflationary-pressure/

https://www.investopedia.com/ask/answers/012115/consumer-pri...

Inflation is just the increase in cost of goods.

QE can cause inflation, but QE != inflation.

It’s called food inflation because people know inflation is about cost, so you don’t need to specify inflation of food costs. You can just say food inflation.

> QE can cause inflation, but QE != inflation.

A reasonable case can be made that QE may actually be deflationary to a certain extent. See Cullen Roche in 2010:

* https://www.pragcap.com/quantitative-easing-the-greatest-mon...

* https://www.pragcap.com/wait-qe-might-be-deflationary/

Depends on where you are looking for inflation, if you look at say S&P 500 performance during QE you will see most of the money supply creation directly lead to stock price inflation and largely lead to a huge bubble in the stock market (that is largely still there) where basic fundamentals of a company did not matter to the stock prices. You see the rise of alot of highly unprofitable companies which under normal conditions would mean lowering of their stock value but instead their stocks were still going up.

QE and other fed programs of the time where designed to ensure stock market inflation, and to prevent the collapse of Big Finance. That is where most of that money supply went, not to mainstreet which is where you would see CPI increases

Come to COVID and the money supply creation was done in direct transfers to Mainstreet, and almost immediately we see CPI go nuts...

Pre-1932 US had a fixed money supply under the gold standard, and there still existed stock market bubbles:

* https://en.wikipedia.org/wiki/Panic_of_1873

* https://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929

Japan has had a constantly growing money supply for decades and its stock market has gone up, down, and sideways in the same time period:

* https://fred.stlouisfed.org/graph/?g=17sx4

Absolutely none of that refutes my position

> […] most of the money supply creation directly lead to stock price inflation and largely lead to a huge bubble in the stock market (that is largely still there) where basic fundamentals of a company did not matter to the stock prices.

You claim that the bubble was caused by the money supply (e.g. QE†), but bubbles have existed even with fixed money supply, so what evidence can you provide actually showing the causal link?

We now have monetary headwinds (e.g., rising rates) and while there was a correction / bear market (≥20% drop in 2022), the headwinds have continue while the market has recovered.

† Which, BTW, is is not really adding new assets, but is rather an asset swap:

* https://www.pragcap.com/the-exploding-u-s-money-supply-myth/

Have you considered that it was not "the old definition", but just that you were wrong about it?

It was the old definition. It made more sense when the money supply was defined as a the pool of circulating money. Now that the supply is debt based and abstract, it became non pragmatic to keep referencing it.

> Now that the supply is debt based and abstract, it became non pragmatic to keep referencing it.

Supply has been debt-based (or rather, credit-based) for decades, if not at least a century. It was wrong for decades, and yet folks like Milton Friedman insisted on using this definition:

* https://en.wikipedia.org/wiki/Monetarism

Agree. I’m looking back much farther.

Well that's how it was taught to me. This new thing just confuses me and I wonder what the old inflation should be called now.

https://www.etymonline.com/word/inflation#etymonline_v_6450 >Monetary sense of "enlargement of prices" (originally by an increase in the amount of money in circulation) first recorded 1838 in American English.

Even the oldest wikipedia entry has this: https://en.wikipedia.org/w/index.php?title=Inflation&oldid=2... >In some contexts the word "inflation" is used to mean an increase in the money supply, which is sometimes seen as the cause of price increases. Some economists (of the Austrian school) still prefer this meaning of the term, rather than to mean the price increases themselves. Thus, for example, some observers of the 1920s in the United States refer to "inflation" even though prices of goods were not increasing at the time. Below, the word "inflation" will be used to refer to a general increase in prices unless otherwise specified.

To me inflation means this. What should I call it because nowadays inflation simply means prince increase. What's the term for the "old inflation"? I want a word for it and apparently I can't use inflation anymore because its meaning has changed. Debasement? Can you use that when the central bank expands the money supply and causes the value of currency to decline? Because you can't call that inflation anymore as language has apparently evolved.

The 'oldest' Wikipedia article you linked isn't the 'oldest'. Should you want to go by Wikipedia for a 'truthyness' https://en.wikipedia.org/w/index.php?title=Inflation&oldid=2...

But.. we could reference "a rise in the general price level caused by an imbalance between the quantity of money and trade needs" [1] (Cleveland Fed; On the Origin and Evolution of the Word Inflation).

[1] https://www.clevelandfed.org/publications/economic-commentar...

On reverting to to 'old' meanings, Adam Smith's The real price of everything...is the toil and trouble of acquiring it isn't inconsistent with Marx as long as toil and trouble is, in the end, people. Or perhaps myths of old beliefs that there was no sectoral, geographical nor temporal stickyness to anything. It's as if there were no sudden and unexpected changes in prices during times of a roughly constant amount of specie backing 'prices' that make 10% look like a storm in a teacup, though was it ever 1:1 or was hope to have the means to provide backing more accurate; specie based currency has a long history of volatility over the world, from West African empires to Asia.

We could even go farther... to say that inflation, a change in prices, is caused by expectations of inflation; that the supply of money is driven by the demand for money... and that gets us to whether demand is liability or asset driven which may be full circle.

I just want a word for what I think inflation means. Like when zimbabwe printed a huge amount of money and that completely broke their currency. That's what I think when I hear the term inflation, and the metaphor of inflating a currency makes sense. You blow some air or whatever into the mix of metal so that you can mint more coins with the same amount of metal. As a consequence the value of an individual coin goes down because it doesn't have as much metal in it as the old coins. A fiat currency based on trust that gets inflated by the increase of money supply is not as concrete but the effect is the same.

So when I hear "food inflation" I immediately thing of wheat breads. You rise the breads more so you can make more breads with the same amount of wheat, but of course as a consequence the value of an individual bread should go down over time because the wheat content is lower. But instead, when the media talks about "food inflation" it means the price of bread is going up and not down.

I used to think that "inflation" is about reducing the value of something but apparently it means the complete opposite. So I guess I need a new word for that. What would that be? Debasement? Should hyperinflation that is obviously caused by the increase of money supply be renamed as hyperdebasement too? Like what happened in Zimbabwe. Or are hyperinflation and inflation completely unrelated phenomenons now?

So I generally held the same questions as you. I think part of the answer is in our modern debt based monetary system, there isn’t one clear notion of money supply (M1, m2, m3,..). Also, these supplies of money can be only esoterically linked to price of goods (look at japan). As such talking about price of goods is more applicable to the general population. Debasement has become the unambiguous term for inflation of the money supply.

I think "monetary inflation" is the term you're looking for.

https://en.wikipedia.org/wiki/Monetary_inflation

The old definition, the money supply expansion definition of inflation, has been memory holed.. anyone who fails to use the new definition of inflation is a thought crimer.. please correct your ways

> I thought it means when you increase the money supply the purchasing power of one dollar goes down.

This is the view of right-leaning folks, most famously by Milton Friedman. It turns out to not be accurate as even Friedman realized (Financial Times (UK), June 7, 2003):

> The use of quantity of money as a target has not been a success. I'm not sure that I would as of today push it as hard as I once did.

* https://en.wikipedia.org/wiki/Monetarism

I wonder what hyperinflation means these days. Is hyper food inflation a thing?

You likely thought so because it's the position UBI proponents on HN (and elsewhere) take. They claim that inflation is caused by the increased money supply only and UBI cannot possibly cause inflation, and repeat this in every UBI thread, so somebody who is not familiar with the topic might conclude that inflation is the increase of the money supply.