Economics in One Lesson XVI: The Mirage of Inflation

Posted: June 14, 2012 by ShortTimer in Economic freedom, Economics, Milton Friedman
Tags: ,

From “On the Other Hand” by the western Canadian Frontier Centre for Public Policy:

What these Canadians intially note about inflation and how governments fight inflation isn’t quite true, given quantitative easing and how the fractional reserve banking system works in the US.  They note later on that the US is operating on the “mistaken assumption that the money supply can stimulate the economy and create jobs”.

Milton Friedman discussed this several times, explaining that it’s basically a hidden tax:

“Inflation is the one form of taxation that can be imposed without legislation.”

 

Broken down:

Comments
  1. eat0005 says:

    I agree, especially with Friedman that inflation is like a hidden tax. It’s what some economists say is a tax for holding money. Thanks for sharing!

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