Yes, and while that chart is certainly concerning, I don’t share the belief that that chart proves the fed caused all the inflation we are seeing.
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I agree that the Fed has not caused ALL of the inflation we’re seeing. I’m not sure anyone believes that. But it has surely caused a lot and almost certainly most of it. If you look at the expansion of all Central Bank balance sheets since the pandemic began, that expansion (alone!) is roughly 1/3 of global GDP. It doesn’t take an Economics PhD to see how that would cause a fvck-load of inflation. Yes, fiscal policies, Putin’s douchebaggery, etc have all contributed to the inflation we’re seeing, but the Big Source is… the Fed and the other Central Banks. It’s math. (Paul Volcker turns over in his grave.)[/quote]
Hmmmm…. not finding your argument particularly convincing. Seems you’re mostly saying that since the start of the pandemic the fed and other central banks have increased their balance sheets a bunch, so ipso facto the fed caused the inflation. I’m looking for a stronger analysis to be convinced.
Also, if increasing their balance sheets causes inflation, why didn’t we have inflation (at least some) since the start of QE? The fed has been active with QE since November 2008 but the fed couldn’t even reach it’s target of 2% inflation for years. Why now did QE suddenly become the so effective at causing inflation when it wasn’t for so long? Sure, there’s more QE now, but shouldn’t we have had some inflation for the last decade prior to the pandemic? If it’s merely due to the increase in the size of QE what’s the inflection point that causes it to go from having no effect to having a bunch of effect?
