Inflation - Revision history

182.253.52.3 at 09:18, 6 December 2013

2013-12-06T09:18:47Z

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	===Unbacked money===		===Unbacked money===
	According to [[Murray N. Rothbard\|Rothbard]], '''inflation''' is the process of issuing [[money]] beyond any increase in the stock of specie. In other words, new money substitutes are issued without backing of their specie. The great gain comes from the issuer’s putting new money into circulation. The profit is practically costless, because, while all other people must either sell goods and services and buy or mine gold, the government or the commercial banks are literally creating money out of thin air. They do not have to buy it. Any profit from the use of this magical money is clear gain to the issuers.<ref name="Rothbard_inflation" />		According to [[Murray N. Rothbard\|Rothbard]], '''inflation''' is the process of issuing [[money]] beyond any increase in the stock of specie. In other words, new money substitutes are issued without backing of their specie. The great gain comes from the issuer’s putting new money into circulation. The profit is practically costless, because, while all other people must either sell goods and services and buy or mine gold, the [http://www.grosir-kosmetik.com/63-been-pink-beauty-series.html Been pink] government or the [http://www.grosir-kosmetik.com/62-glutera.html Glutera] commercial banks are literally creating money out of thin air. They do not have to buy it. Any profit from the use of this magical money is clear gain to the issuers.<ref name="Rothbard_inflation" />

	===Rising prices===		===Rising prices===

Pestergaines: /* Links */ +word

2013-07-14T19:32:47Z

Links: +word

← Older revision		Revision as of 19:32, 14 July 2013
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	* [http://mises.org/daily/4654 How the Stock Market and Economy Really Work] by [[Kel Kelly]], September 2010		* [http://mises.org/daily/4654 How the Stock Market and Economy Really Work] by [[Kel Kelly]], September 2010
	* [http://mises.org/MediaPlayer.aspx?Id=6022&silverlight=0 Currency Failures from Argentina to Zimbabwe: A Brief History of Inflation] (video) by Timothy D. Terrell, November 2010		* [http://mises.org/MediaPlayer.aspx?Id=6022&silverlight=0 Currency Failures from Argentina to Zimbabwe: A Brief History of Inflation] (video) by Timothy D. Terrell, November 2010
	* [http://www.cato.org/research/troubled-currencies-project?tab=introduction The Troubled Currencies Project] (maps the official and unofficial exchange rates and effective inflation rates of currencies, where official data is unreliable or unavailable)		* [http://www.cato.org/research/troubled-currencies-project?tab=introduction The Troubled Currencies Project] (maps the official and unofficial exchange rates and effective inflation rates of some currencies, where official data is unreliable or unavailable)

	* {{wplink}}		* {{wplink}}

	[[Category:Money]]		[[Category:Money]]

Pestergaines: /* Links */ +re

2013-07-14T19:31:12Z

Links: +re

← Older revision		Revision as of 19:31, 14 July 2013
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	* [http://mises.org/daily/4654 How the Stock Market and Economy Really Work] by [[Kel Kelly]], September 2010		* [http://mises.org/daily/4654 How the Stock Market and Economy Really Work] by [[Kel Kelly]], September 2010
	* [http://mises.org/MediaPlayer.aspx?Id=6022&silverlight=0 Currency Failures from Argentina to Zimbabwe: A Brief History of Inflation] (video) by Timothy D. Terrell, November 2010		* [http://mises.org/MediaPlayer.aspx?Id=6022&silverlight=0 Currency Failures from Argentina to Zimbabwe: A Brief History of Inflation] (video) by Timothy D. Terrell, November 2010
			* [http://www.cato.org/research/troubled-currencies-project?tab=introduction The Troubled Currencies Project] (maps the official and unofficial exchange rates and effective inflation rates of currencies, where official data is unreliable or unavailable)

	* {{wplink}}		* {{wplink}}

	[[Category:Money]]		[[Category:Money]]

Jérôme Alexandre: /* Bibliography */

2013-03-03T18:32:07Z

Bibliography

← Older revision		Revision as of 18:32, 3 March 2013
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	\|year=1962		\|year=1962
	\|url=http://mises.org/document/5224/An-Inflation-Primer		\|url=http://mises.org/document/5224/An-Inflation-Primer
			\|oclc=327322
	}}		}}
	* {{Cite journal		* {{Cite journal
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	\|year=1933		\|year=1933
	\|url=http://mises.org/document/3041/Fiat-Money-Inflation-in-France		\|url=http://mises.org/document/3041/Fiat-Money-Inflation-in-France
			\|oclc=5174308
	}}		}}
	* {{cite encyclopedia		* {{cite encyclopedia
	\|last=White\|first=Lawrence H.\|authorlink=		\|last=White\|first=Lawrence H.\|authorlink=Wikipedia:Lawrence H. White
	\|editor-last=Henderson\|editor-first=David R.\|editor-link=Wikipedia:David R. Henderson		\|editor-last=Henderson\|editor-first=David R.\|editor-link=Wikipedia:David R. Henderson
	\|title=Inflation		\|title=Inflation
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	\|location=Indianapolis, Indiana		\|location=Indianapolis, Indiana
	\|isbn=978-0-86597-665-8		\|isbn=978-0-86597-665-8
			\|oclc=123350134
	\|pages=262-266		\|pages=262-266
	}}		}}

Jérôme Alexandre: /* Bibliography */ "Inflation and Unemployment" by Hans Sennholz

2013-03-03T17:53:21Z

Bibliography: "Inflation and Unemployment" by Hans Sennholz

← Older revision		Revision as of 17:53, 3 March 2013
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	\|year=1962		\|year=1962
	\|url=http://mises.org/document/5224/An-Inflation-Primer		\|url=http://mises.org/document/5224/An-Inflation-Primer
			}}
			* {{Cite journal
			\|last=Sennholz\|first=Hans F.\|authorlink=Hans Sennholz
			\|title=Inflation and Unemployment
			\|journal=[[The Freeman]]
			\|volume=36\|issue=6
			\|year=1986
			\|pages=226-233
			\|url=http://www.fee.org/the_freeman/detail/inflation-and-unemployment
	}}		}}
	* {{Cite book		* {{Cite book

Jérôme Alexandre: Bibliography

2013-03-03T17:05:25Z

Bibliography

@@ Line 115: / Line 115: @@
 ==References==
 {{Reflist}}
 ==Links==
 * [http://www.econlib.org/library/Enc/Inflation.html Inflation] from The Concise Encyclopedia of Economics
-* [http://bpp.mit.edu/ The Billion Prices Project], [[MIT]], a series of experimental inflation indexes
+* [http://bpp.mit.edu/ The Billion Prices Project], [[Wikipedia:Massachusetts Institute of Technology|MIT]], a series of experimental inflation indexes
 * [http://www.mises.org/story/2340 The Revolutionary War and the Destruction of the Continental] by [[Thomas E. Woods, Jr.]]
 * [http://libertarianpapers.org/articles/2009/lp-1-43.pdf The Definition of Inflation According to Mises: Implications for the Debate on Free Banking] (pdf) by Nicolás Cachanosky
 * {{mb|16955|Just What Is Inflation?|[[Douglas French]]|May 2011}}
@@ Line 128: / Line 166: @@
 * {{mb|4212|Inflation and Supply-Side Economics|[[Stefan Karlsson]]|October 2005}}
 * [http://mises.org/daily/4431 "Deficit Financing" and Inflation] by Ludwig von Mises and Bettina Bien Greaves
 * [http://mises.org/daily/3729 Gold vs Paper] by [[Ludwig von Mises]], orig. published in July 1953
 * [http://mises.org/daily/4654 How the Stock Market and Economy Really Work] by [[Kel Kelly]], September 2010

Pestergaines: /* Rising prices */ Changed title of section to "Ways to increase prices".

2013-01-21T16:41:51Z

Rising prices: Changed title of section to "Ways to increase prices".

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	Increases in the money supply initiate an exchange of something for nothing. They divert real funding away from those, that generate wealth towards the holders of the newly created money. The general increases in prices, which follow, are a symptom of the erosion of money's purchasing power.<ref name="Shostak_inflation" />		Increases in the money supply initiate an exchange of something for nothing. They divert real funding away from those, that generate wealth towards the holders of the newly created money. The general increases in prices, which follow, are a symptom of the erosion of money's purchasing power.<ref name="Shostak_inflation" />

	===~~Rising~~ prices===		===Ways to increase prices===
	The increase in the money supply will create a new level of [[price]]s, but it will not be the old level of prices, multiplied in all relations and quantities.		The increase in the money supply will create a new level of [[price]]s, but it will not be the old level of prices, multiplied in all relations and quantities.

Pestergaines: /* Rising prices */ Yet another way to raise prices.

2013-01-21T16:40:33Z

Rising prices: Yet another way to raise prices.

← Older revision		Revision as of 16:40, 21 January 2013
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	New money will change the spending habits of people. Also, some of them will make gains and losses and will alter their spending habits accordingly. Therefore, all prices will not increase uniformly. Some prices will rise more than others, therefore, some people will be permanent gainers, and some permanent losers, from the inflation.<ref name="Rothbard_inflation" />		New money will change the spending habits of people. Also, some of them will make gains and losses and will alter their spending habits accordingly. Therefore, all prices will not increase uniformly. Some prices will rise more than others, therefore, some people will be permanent gainers, and some permanent losers, from the inflation.<ref name="Rothbard_inflation" />

	Instead of raising prices, some companies prefer to reduce the quantity of the good sold.<ref name="Tucker_Shrinkage"> Jeffrey Tucker. [http://blog.mises.org/15410/prodcut-shrinkage/ "Product shrinkage"], ''Mises Blog'', January 24, 2011. Referenced 2011-01-25.</ref><ref name="Dickler_product">Jessica Dickler. [http://money.cnn.com/galleries/2011/pf/1101/gallery.downsized_consumer_products/index.html "Your favorite products - now 20% smaller"], ''CNNMoney.com'', January 06 2011. Referenced 2011-01-25.</ref><ref name="Basenese_Shrinkage">Lou Basenese. [http://www.istockanalyst.com/finance/story/5029395/the-shrinkage-factor-10-signs-that-food-inflation-is-alive-and-well The "Shrinkage" Factor: 10 Signs That Food Inflation Is Alive And Well], ''iStockAnalyst'', Apr 01, 2011. Referenced 2011-01-25.</ref><ref name="Clifford_Bags">Stephanie Clifford and Catherine Rampell. [http://www.nytimes.com/2011/03/29/business/29shrink.html?_r=2 "Food Inflation Kept Hidden in Tinier Bags"], ''New York Times'', March 28, 2011. Referenced 2011-01-25.</ref>		Instead of raising prices, some companies prefer to reduce the quantity of the good sold.<ref name="Tucker_Shrinkage"> Jeffrey Tucker. [http://blog.mises.org/15410/prodcut-shrinkage/ "Product shrinkage"], ''Mises Blog'', January 24, 2011. Referenced 2011-01-25.</ref><ref name="Dickler_product">Jessica Dickler. [http://money.cnn.com/galleries/2011/pf/1101/gallery.downsized_consumer_products/index.html "Your favorite products - now 20% smaller"], ''CNNMoney.com'', January 06 2011. Referenced 2011-01-25.</ref><ref name="Basenese_Shrinkage">Lou Basenese. [http://www.istockanalyst.com/finance/story/5029395/the-shrinkage-factor-10-signs-that-food-inflation-is-alive-and-well The "Shrinkage" Factor: 10 Signs That Food Inflation Is Alive And Well], ''iStockAnalyst'', Apr 01, 2011. Referenced 2011-01-25.</ref><ref name="Clifford_Bags">Stephanie Clifford and Catherine Rampell. [http://www.nytimes.com/2011/03/29/business/29shrink.html?_r=2 "Food Inflation Kept Hidden in Tinier Bags"], ''New York Times'', March 28, 2011. Referenced 2011-01-25.</ref> Another possibility is to create blends of coffee out of cheaper ingredients<ref name="Smith_Bitter">Rich Smith. [http://www.dailyfinance.com/2012/06/19/noticed-that-your-coffee-tastes-funny-heres-why/?a_dgi=aolshare_twitter "The Bitter Truth About Why Your Coffee Isn't Tasting as Good Lately"], ''Daily Finance'', The Motley Fool, Posted 06/19/12. Referenced 2013-01-21.</ref> or watering beer down.<ref name="Dixon_Bitter">Hayley Dixon. [http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/9801908/Bitter-taste-for-drinkers-as-beer-is-watered-down-to-save-money.html "Bitter taste for drinkers as beer is watered down to save money"], ''The Telegraph'', 15 January 2013. Referenced 2013-01-21.</ref>

	==Further misconceptions==		==Further misconceptions==

Pestergaines: Links adjusted.

2012-01-20T09:47:50Z

Links adjusted.

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	{{~~See also~~\|Inflations}}		{{For\|historical examples of inflation\|Inflations}}


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	===Rising prices===		===Rising prices===
			{{Main\|Price inflation}}
	In a popular definition, '''inflation''' is an ongoing rise in the general level of prices.<ref name="White_inflation">Lawrence H. White. [http://www.econlib.org/library/Enc/Inflation.html "Inflation"], ''[[Wikipedia:Concise Encyclopedia of Economics\|The Concise Encyclopedia of Economics]]'', referenced 2009-05-26.</ref>		In a popular definition, '''inflation''' is an ongoing rise in the general level of prices.<ref name="White_inflation">Lawrence H. White. [http://www.econlib.org/library/Enc/Inflation.html "Inflation"], ''[[Wikipedia:Concise Encyclopedia of Economics\|The Concise Encyclopedia of Economics]]'', referenced 2009-05-26.</ref>

Pestergaines: -WP link

2011-10-13T15:11:28Z

-WP link

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	Why is counterfeiting so bad if the government itself prints money? Suppose that Joe Doakes and his merry men have invented a perfect counterfeit. What would happen? In the first place, the aggregate money supply of the country would increase by the amount counterfeited; equally important, the new money will appear first in the hands of the counterfeiters themselves. Counterfeiting, in short, involves a twofold process: (1) increasing the total supply of money, thereby driving up the prices of goods and services and driving down the purchasing power of the money-unit; and (2) changing the distribution of income and wealth, by putting disproportionately more money into the hands of the counterfeiters.		Why is counterfeiting so bad if the government itself prints money? Suppose that Joe Doakes and his merry men have invented a perfect counterfeit. What would happen? In the first place, the aggregate money supply of the country would increase by the amount counterfeited; equally important, the new money will appear first in the hands of the counterfeiters themselves. Counterfeiting, in short, involves a twofold process: (1) increasing the total supply of money, thereby driving up the prices of goods and services and driving down the purchasing power of the money-unit; and (2) changing the distribution of income and wealth, by putting disproportionately more money into the hands of the counterfeiters.

	[[~~Wikipedia:David Hume\|~~David Hume]], in order to demonstrate the inflationary and non-productive effect of paper money, in effect postulated what Rothbard called the "Angel Gabriel" model, in which the Angel, after hearing pleas for more money, magically doubled each person's stock of money overnight. (In this case, the Angel Gabriel would be the "counterfeiter," albeit for benevolent motives.) While everyone would be happy from their seeming doubling of monetary wealth, society would in no way be better off: there would be no increase in capital or productivity or supply of goods. As people rushed out and spent the new money, the only impact would be an approximate doubling of all prices, and the purchasing power of the money would be cut in half, with no social benefit being conferred. An increase of money can only dilute the effectiveness of each unit of money.		[[David Hume]], in order to demonstrate the inflationary and non-productive effect of paper money, in effect postulated what Rothbard called the "Angel Gabriel" model, in which the Angel, after hearing pleas for more money, magically doubled each person's stock of money overnight. (In this case, the Angel Gabriel would be the "counterfeiter," albeit for benevolent motives.) While everyone would be happy from their seeming doubling of monetary wealth, society would in no way be better off: there would be no increase in capital or productivity or supply of goods. As people rushed out and spent the new money, the only impact would be an approximate doubling of all prices, and the purchasing power of the money would be cut in half, with no social benefit being conferred. An increase of money can only dilute the effectiveness of each unit of money.

	In real life, the very point of counterfeiting is to constitute a process of transmitting new money from one pocket to another. Whether counterfeiting is in the form of making brass or plastic coins that simulate gold, or of printing paper money to look like that of the government, counterfeiting is always a process in which the counterfeiter gets the new money first.		In real life, the very point of counterfeiting is to constitute a process of transmitting new money from one pocket to another. Whether counterfeiting is in the form of making brass or plastic coins that simulate gold, or of printing paper money to look like that of the government, counterfeiting is always a process in which the counterfeiter gets the new money first.