[rufus_foreman]

>> I really do not understand why most people seem to think deficit spending is not the cause of inflation. Print a bunch of money and make a lot of people millionaires either on paper or realized gains

If the government finances deficit spending through printing money, the link to inflation is clear. Printing money to finance a deficit doesn't cause inflation, it IS inflation.

But you can also finance a deficit by borrowing money rather than printing money. The link between borrowing to finance a deficit and inflation is less clear. Milton Friedman said that:

"One effect is upward pressure on interest rates, and hence, given the Federal Reserve’s unfortunate propensity to operate through interest rates, higher monetary growth. In addition, by reducing private incentives to work, save and engage in productive ventures and by crowding out private investment, high government spending inhibits economic growth so that any given rate of monetary growth produces a higher rate of inflation."

But other economists disagree, as economists tend to do, and as others have pointed out, there have been periods in the US of huge increases in borrowing during periods of decreasing inflation.