This is the Cantillon effect posited by Irish economist and Adam Smith predecessor Richard Cantillon: price inflation is relative and staggered as “newly created is distributed neither equally nor simultaneously among the population.” Picture banks and their favored borrowers with access to the Fed’s zero interest rate program borrowing dollars and investing in assets that have either higher yields like Treasuries or long-term security like gold. Later on, consumers without those resources or sophistication are punished at the gas pump and grocery story by the resulting price inflation. Printing money doesn’t just cause financial disorder; it stokes inequality.
Source link: http://archive.mises.org/18227/cantillon-in-forbes/
Cantillon in Forbes
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