Tuesday, July 30, 2013

Monetarist Versus Austrian- Views on Inflation

The video below shows a debate between Peter Schiff and Scott Sumner- moderated by Kudlow on CNBC. Market pundits continue to obsessively debate inflation through the lens of the CPI (which I do agree with Schiff and others is manipulated via hedonic edits and the like, resulting in an understatement), but miss the fact that inflation is outsized growth in money supply.




As M2 money supply has increased by more than 5x since 1980......

Graph of M2 Money Stock

GDP doubled over the same time period.

FRED Graph

but there is no inflation.

No comments:

Post a Comment