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Old 09-01-2020, 06:17 PM
 
Location: Flyover part of Virginia
3,041 posts, read 1,615,352 times
Reputation: 4187

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People think 'inflation' means rising prices. But that's not the real definition, but one made up by the governments and central banks. The original definition of inflation was the expansion of the supply of currency and credit. Rising prices are merely a symptom of inflation. The supply of currency and credit inflates or deflates. Prices don't inflate or deflate, the rise or fall.

The reason the central banks and governments define inflation as rising prices is so they can pretend like they don't cause it. When you have an accurate definition of inflation, you know exactly who's to blame. But when the governments and central banks can define a sympton of inflation (rising consumer prices), as inflation itself, then they can blame whoever's raising the prices: the greedy business men, the speculators, they used to blame the labor unions, opec, China, etc.

If you want proof of this, get an Oxford Dictionary from 100 years ago and look up the definition of 'inflation'- it will be defined as the expansion of money and credit. They won't even mention anything about prices.
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Old 09-01-2020, 06:19 PM
 
Location: Berwick, Penna.
15,912 posts, read 10,371,106 times
Reputation: 20478
hear. hear, HEAR!

Money can't lose its value if Big Brother/Sister isn't allowed to tamper with it.
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Old 09-01-2020, 06:33 PM
 
16,350 posts, read 14,796,831 times
Reputation: 14736
Quote:
Originally Posted by Taggerung View Post
People think 'inflation' means rising prices. But that's not the real definition, but one made up by the governments and central banks. The original definition of inflation was the expansion of the supply of currency and credit. Rising prices are merely a symptom of inflation. The supply of currency and credit inflates or deflates. Prices don't inflate or deflate, the rise or fall.

The reason the central banks and governments define inflation as rising prices is so they can pretend like they don't cause it. When you have an accurate definition of inflation, you know exactly who's to blame. But when the governments and central banks can define a sympton of inflation (rising consumer prices), as inflation itself, then they can blame whoever's raising the prices: the greedy business men, the speculators, they used to blame the labor unions, opec, China, etc.

If you want proof of this, get an Oxford Dictionary from 100 years ago and look up the definition of 'inflation'- it will be defined as the expansion of money and credit. They won't even mention anything about prices.
So does this mean you are for a fixed money supply?
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Old 09-01-2020, 06:58 PM
 
Location: Flyover part of Virginia
3,041 posts, read 1,615,352 times
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Quote:
Originally Posted by EDS_ View Post
So does this mean you are for a fixed money supply?
I am for defining inflation correctly, because defining it incorrectly leads to bad monetary policy. Central banks can persist with disastrous expansionary policy because they are looking at consumer prices and don't see runaway increases. Especially not with the rigged indexes they use for gauging prices.
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Old 09-01-2020, 07:29 PM
 
16,350 posts, read 14,796,831 times
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Quote:
Originally Posted by Taggerung View Post
I am for defining inflation correctly, because defining it incorrectly leads to bad monetary policy. Central banks can persist with disastrous expansionary policy because they are looking at consumer prices and don't see runaway increases. Especially not with the rigged indexes they use for gauging prices.

I'll help you a little. You are either for a fixed money supply or expansionary policy.
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Old 09-01-2020, 11:17 PM
 
347 posts, read 772,582 times
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What is the real money supply? Is it simply the measure of the number of dollars in existence? Is it affected by the rapidity with which those dollars move? Does it consider the amount of goods and services available for purchase? Is it affected by the number of people among whom those dollars are spread? Does it make sense to see a healthy level of inflation, whether you believe that to be zero or slightly higher, while the economy is collapsing because of catastrophically falling prices? Or does it make more sense to measure the effect of the money supply rather than its absolute value?
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Old 09-02-2020, 07:41 AM
 
Location: Bangkok
11,982 posts, read 6,224,895 times
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Quote:
Originally Posted by EDS_ View Post
I'll help you a little. You are either for a fixed money supply or expansionary policy.
For Taggerung.... which monetary policy do you advocate?

[] Fixed
[] Expansionary

Please choose only on answer.
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Old 09-02-2020, 08:37 AM
 
Location: Bangkok
11,982 posts, read 6,224,895 times
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Quote:
Originally Posted by Taggerung View Post
People think 'inflation' means rising prices. But that's not the real definition, but one made up by the governments and central banks. The original definition of inflation was the expansion of the supply of currency and credit. Rising prices are merely a symptom of inflation. The supply of currency and credit inflates or deflates. Prices don't inflate or deflate, the rise or falll
Source?

I'd counter the original definition of inflation was describing the act of inflating, coming from the Latin word "inflatus" which means to swell. Saying it isn't rising prices is like pointing at the rash on someone's face who has chickenpox and saying that rash is not chickenpox because chickenpox is microscopic virus.

Monetary inflation and price inflation are indeed two different things, but that has nothing to do with your attempt to pigeonhole the general definition of inflation on one and not the other.



Quote:
Originally Posted by Taggerung View Post
If you want proof of this, get an Oxford Dictionary from 100 years ago and look up the definition of 'inflation'- it will be defined as the expansion of money and credit. They won't even mention anything about prices.
How about 223 years ago?

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Old 09-02-2020, 08:43 AM
 
3,940 posts, read 2,050,040 times
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Quote:
Originally Posted by EDS_ View Post
I'll help you a little. You are either for a fixed money supply or expansionary policy.
A third choice/nuance is possible — a money supply that expands in step with productive economic growth.
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Old 09-02-2020, 09:58 AM
 
Location: Shawnee-on-Delaware, PA
7,034 posts, read 6,115,612 times
Reputation: 14000
Quote:
Originally Posted by Taggerung View Post
If you want proof of this, get an Oxford Dictionary from 100 years ago and look up the definition of 'inflation'- it will be defined as the expansion of money and credit. They won't even mention anything about prices.
Who cares what a dictionary said 100 years ago? We are real people living in 2020, using real language.

The meaning of inflation in the year 2020 is "rising prices". Deflation means falling prices. Ask anyone who isn't trying to impress their Econ 101 prof.
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