States, regardless of their constitution, are not economic enterprises. In contrast to the latter, states do not finance themselves by selling products and services to customers who voluntarily pay, but by compulsory levies: taxes collected through the threat and use of violence (and through the paper money they literally create out of thin air). Significantly, economists have therefore referred to governments—i.e., the holders of state power—as stationary bandits. Governments and everyone on their payroll live off the loot stolen from other people.

“Inflation” is back in the headlines, and a lot of nonsense is being said about it. Without much thought whether it makes sense or not, “inflation” is defined as a general rise in prices. Official statistics claim that the “price level” can be measured and its change calculated as the so-called inflation rate, there being almost no critical evaluation of the reliability of these numbers.

A monetary system that allows the creation of money out of thin air is vulnerable to the fits of credit expansion and credit contraction. Periods of credit expansion typically occur over many years and even decades while the phases of credit contraction happen like sudden implosions. The monetary policy makers tend to promote the prolongation of credit expansion because they fear deflation.

The Wall Street Journal reports today that Twitter’s senior management and Elon Musk are in the final stages of agreeing on terms for Musk’s proposed takeover of the social media platform. Musk had announced on April 21 that he had $46.5 billion lined up—half in cash, half financed by his bankers Morgan Stanley, Barclays, and Bank of America—for a purchase of the company.

One of the most important days on the calendar is little more than a week away: May 4. Next Wednesday, Federal Reserve Chair Jerome Powell may very well deliver a Keynesianesque double-feature, announcing various asset bubbles will be popped and a nail in the coffin is to be delivered into the economy, courtesy the Fed.