Inflation

Jeff and Bob discuss the mechanics—and pain—required to put an end to inflation.

Paul Krugman recently wrote that the reason we see high inflation is that people mistakenly believe inflation is in our future and act accordingly. This reasoning is false.

Despite assurances from politicians and the media, the Federal Reserve System is not a collection of geniuses who stand guard against inflation and recession. Instead, think of the Fed policy makers as the Keystone Cops of central banking.

The "experts" solemnly tell us that deflation is even worse than inflation, and that deflation always will lead an economy into recession. The truth turns such "wisdom" upside down.

Recorded in Birmingham, Alabama, on April 2, 2022.

The usual "experts" claim inflation is a general increase in the price level. Wrong. Prices rise because of inflation, which is a government-caused increase in the amount of money in circulation.

Despite assurances from politicians and the media, the Federal Reserve System is not a collection of geniuses who stand guard against inflation and recession. Instead, think of the Fed policy makers as the Keystone Cops of central banking.

Paul Krugman recently wrote that the reason we see high inflation is that people mistakenly believe inflation is in our future and act accordingly. This reasoning is false.

The usual "experts" claim inflation is a general increase in the price level. Wrong. Prices rise because of inflation, which is a government-caused increase in the amount of money in circulation.

Jeff and Bob discuss the dynamics of the housing market in the context of a recent talk by Alex Pollock.