So your position is, if Bernanke made it rain 100 trillion dollars and 250 million people charged each other $(100 trillion/250 million) for the massage, then money is not devalued?
Yes the example is contrived but it illustrates you are wrong.
Yes the example is contrived but it illustrates you are wrong.
Also, people aren't going to buy 100 trillion in massages, that is fucking ridiculous, if you start from a ridiculous set of circumstances, you're going to arrive at a ridiculous ending point -- it's not instructive of anything.
What is the problem with a toy model in extreme to illustrate the absurdity of your position?
>What is the problem with a toy model in extreme to illustrate the absurdity of your position?
It's not illustrative of anything, other than a contrived absurd example.
If there was capacity to absorb 100 trillion in massages (equally absurd), then prices would remain stable.
Think of it like this: we hit a recession, orders drop and companies lay off workers and produce less output. From one day to the next the capacity for a certain level of output remains the same, but on the second day less is produced.