L.A. Liberty

[On Inflation]

Under Austrian orthodoxy, the money supply works in extraordinarily predictable ways: namely, if you increase it, inflation follows. Austrians have always defined inflation solely as an increase in the money supply .

A quick point: yes indeed “Austrians have always defined inflation solely as an increase in the money supply.” But then again, so did everyone else. I’ve discussed this before:

Even Keynes himself defined [inflation] this way. In fact, from 1864-2003, that’s exactly how Webster’s defined inflation: “undue expansion or increase, from over-issue; — said of currency.”

That this definition is less common today is a direct consequence of what can only be considered many years’ worth of Orwellian language restructuring [by the neo-Keynesians and monetarists*]. As I previously explained, “Inflation was and is definitionally printing money, or more specifically inflating the money supply. By divorcing the word from its literal origins, [central planning apologists] cloud the direct effect between money printing and the value of money.”

This is not unlike suddenly using the word dog to instead refer to dog piss.