How The Soviets “Fixed” Inflation, But Wrecked the Economy
5th November 2022
Price inflation and the resulting business cycles are monetary phenomena, and without increases in the money supply—i.e., monetary inflation—there is no price inflation. If the world were a very simple place, we would see this relationship clearly displayed: when the money supply increased, we would also see a general increase in prices soon thereafter. The world, however, is not a very simple place and an economy can include countless factors that can mask, delay, and otherwise obscure the connection between monetary inflation and price inflation.