[noahtallen]

I like this comment a lot, but I think there is a lot more context inside “printing money” that goes into inflation and money supply in unexpected ways via debt. My rough and probably inaccurate understanding is that debt isn’t necessarily money a bank has on hand to provide you, but what a bank gives you can be created “out of thin air” depending on what the government wants to promote economically. Money can be pulled out of the economy entirely by increasing interest rates so that debt payments go up. In other words, this is very different to the war-time inflation of 80 years ago, and the government has a lot of extra levers to try to alleviate the the problems inflation can bring.

But the other side of it is that we’ve built our economy on the foundation that growth and inflation will always exist. All our retirement funds are in, say, index funds which rely on stocks to be worth significantly more in the future. Same for home property values. A business can only get investment and make their public investors happy if they continue to grow year after year. All of this only works if inflation exits in moderation.

The downside is our economy is not equipped to handle an equilibrium — what if we reach neutral or even negative population growth? What if automation makes more jobs unavailable? We’ll need to severely rethink how our economy works.