0 sats \ 11 replies \ @didiplaywell 21 May \ on: It's worse than you think - Vox Popoli econ
Two questions:
- What do you imply exactly by "inflation is borrowing money"?
- What's the "public economy"?
One observation:
- No theory says that "inflation is printing money". No economist has ever said that! For instance, that's not what the monetarist theory says either. Monetarism clearly states that "inflation is caused when money is printed above the real rate of growth of the economy", which in practice is traduced in the state spending more money units than the units it receives through direct taxation.
The original meaning of “inflation” was money creation, so you are not correct about that.
The entire Austrian Economics tradition still uses the term in its original meaning.
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I didn't say that inflation isn't creating money, I said that the expression is incomplete!
I vow for the Austrian principles.
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Sorry, I misunderstood your point.
It would still be correct to say that printing money is inflation, but it's only one form of it.
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What you mean with "one form of it"?
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Money can be created either by directly printing it or through creation of new debt.
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It's quoted, I don't say it, the author of the blog post does. I think it's because he sees borrowing as the primary cause of the expansion of the money supply.
Public economy is a reference to the economic activities controlled by the public sector, i.e. the government.
Monetarism clearly states that "inflation is caused when money is printed above the real rate of growth of the economy", which in practice is traduced in the state spending more money units than the units it receives through direct taxation.
I think that is what the screenshot implies.