I’m considering those costs that depend on exchange rates. When dollar goes down, it directly affects prices of things we import and prices of things we can export. Burgers are neither.
Beef is an internationally traded commodity, one of Argentina’s historically main exports, to give one example. The grain you feed cattle is a commodity too. To think that the local burger joint is isolated of the world is naive. We just can’t have a devalued dollar for a long time and not expect inflation at home. (On the other hand, if the dollar appreciates rapidly against the gold/silver/euro, I’m ready to change my outlook, but that’s not the case for now.)
And your comment: Full steam you say? The Fed is going to exchange up to 200B of treasury bonds for 200B of mortgage-backed securities. How’s that printing?
That graph is of the monetary base!!! As you can see it’s not constant as you assumed in your prior reply. And more importantly, the monetary base is the narrowest definition of money. The recent Fed moves are inflating M1, and especially M2 and M3. You need to consult an ECON 101 textbook so you can see the difference between these definitions of money.
How’s that printing? I explained before that I was using a metaphorical expression. Perhaps we need a dictionary too? Bsrsharma agreed with me that this $200B injection can be considered “printing” money in this broad sense. You don’t need to have more coins and dollar bills to fan inflation: the other, broader, definitions of money will do.
