Saturday, March 17, 2012

Don't get all Hyper!


At work we got notified by one of our suppliers of an impending price hike. Our reaction is to put a big order together ASAP, and buy that stuff for all the jobs we have and most of the jobs we hope to get.

Inflation accelerates spending.


People say printing money causes inflation. But that's informal. Really, it isn't the printing that causes inflation. It's the spending.

Spending causes inflation.


Spending causes inflation, and inflation accelerates spending.

That's why sometimes inflation becomes hyperinflation. It wants to be a self-reinforcing feedback loop.

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