The Keynesians keep telling me that inflation is a good thing. Now this chart has the implicit price deflator, which is all of inflation, producer and consumer and anything else that falls out of the national accounts after the data is settles. So look at the thing, when it reaches 2.5 we crash. Each an every recession is preceded by the price deflator spending time above 2.5, that would be 1991, 2001, and 2009. Further back we see it peaked just before the big 1981 recession. Look at 2011, it went above 2.0, right at the stimulus, and nearly threw the economy into another recession.
So what is inflation good for? Why do the Keynesians want more of it?
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