When and how did it happen? How did the definition of inflation become so deformed over the decades? It used to be easily and properly understood as a decline in the unit of account; in our case the dollar.
In the 1970s policy favored devaluation. Love or hate gold, President Nixon’s decision to sever the dollar’s link to the yellow metal was an explicit devaluation. And prices across the board rose. It’s popular among the confused to say that rising oil prices in the 1970s caused inflation. Such a viewpoint gets inflation exactly backwards. The shrinking dollar was the inflation, only for prices of not just oil, but wheat, meat, soybeans, and every other commodity under the sun to soar as a reflection of a shrinking dollar measure.
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