[quote=sdduuuude]The graph shows 7 years of money supply increase.
Inflation has, in that 7 years, been unremarkable.
Seems if the increase in money supply was going to cause major inflation, we would see some movement by now. Something else must be in effect.
I’m with Arraya and Econ Prof on this one.[/quote]
There are at least 2 kinds of inflation. Consumer price inflation, as most commonly measured (however flawed) in the US by the CPI. And monetary inflation, as measured by increases in money supply.
Austrian economics, which had a productive origin in the late 19th and early 20th century (and has pretty much stagnated in an idealogical circle-jerk since then) focused on monetary inflation and (theoretical) price deflation. It’s not incorrect. It’s just not always useful, and shy empirical evidence. From an academic standpoint, Austrian business cycle theory had value. Since then, it’s pretty much, from its subscribers view point, a classical heterodox. For others, it’s simply something to point at and laugh. It’s a joke. Ergo, Ron Paul.
