[CoffeeCollector]

You are getting down voted for telling the truth. Every inflation discussion starts with the supply side economics or companies raising taxes, but inflation only happens in reality because of government spending, borrowing, and deficit spending.

[d4mi3n]

> but inflation only happens in reality because of government spending, borrowing, and deficit spending.

This is incorrect. Note that governments around the world are also experiencing record levels of inflation and each has their own fiscal policy.

Inflation is an aggregate economic effect driven by a variety of factors—including but by no means limited to government spending. Other things that contribute to inflation:

1. Supply shortages

2. Cost of living

3. Abundance of capital (low interest rates, high wages, etc)

4. Speculation

Basically anything that contributes to groups of people assigning a higher value to the same set of goods or services.

Supply is the most immediately noticeable cause and COVID has disrupted supply chains for some time. It is entirely unsurprising we've seen inflation as a result. Government policy has certainly played a part, but blaming everything on government spending is misleading in that ignores the larger realities of inflation beyond the borders of any nation state.

[CoffeeCollector]

Most of your ‘refutation’ is dishonest, Keynesian, MMT nonsense. Fiat doesn’t get introduced unless printed or borrowed by the government. Full stop. Companies raising prices is not inflation and conflating that with government monetary policy is outright disinformation.

[kelnos]

> Companies raising prices is not inflation

Given that we base inflation numbers on CPI, inflation exactly is companies raising prices -- well, companies that produce the goods that are included in CPI, anyway.

Yes, we still have to consider the reasoning behind why they are raising prices. Personally, I believe it is more because of supply chain shortages than COVID fiscal policy (though the latter certainly contributes), but I agree that's up for debate.

[CoffeeCollector]

> Personally, I believe it is more because of supply chain shortages

Why?

[d4mi3n]

I'm not an economist and don't really understand your refutation. To help me understand your viewpoint, could you explain in simple language why government spending or policy is the only source and cause of inflation? Please correct me if that's an incorrect interpretation of your statements.

Going by what I see as an individual, there are lots of things happening around me that drive prices up that don't have any strong relationship to my government's policy (e.g. bird flu raising poultry prices). I also don't understand how this can be the case simultaneously across multiple governments around the world.

[CoffeeCollector]

https://en.m.wikipedia.org/wiki/Monetary_inflation

[sandworm101]

Inflation happens too in markets without governments. Government therefore cannot be the one cause.

[CoffeeCollector]

What markets exist outside of government authority? No, black and gray markets don’t count because the increased money supplies created by governments will affect the overall amount of money chasing goods in any market.