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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Author: albaby1 ✶❂🐝 GOLD
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Number: of 86253 
Subject: Re: Nobody says this, but "the groceries"
Date: 11/05/25 7:52 PM
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Those things cause short term increases in prices. Monetary supply causes systemic inflation of the type we're talking about.

Perhaps you should have read further on Investopedia:


They can all cause systemic inflation of the type we're talking about - because remember, this thread is about the type of inflation caused by tariff policy. Exactly the sort of thing that can trigger a year or two of inflation. And in fact, they can also cause systemic inflation that runs for the longterm, because even short-term bouts of inflation can lead to a perpetual cycle of inflation based on expectations.

The article you cited on Investopedia was explaining how money supply can affect inflation - not that money supply is the only thing that can cause inflation.

Repeatedly saying that something is "Econ 101," as has been done on this thread, isn't the flex that people think it is. It's actually a pretty good indicator that the person making the claim is probably wrong, or at least lacks much knowledge of economics beyond a surface awareness. That's because the stuff you're taught in Econ 101 is the "wrong but useful" stuff. It's a simplified model of economic concepts that's appropriate for beginners, but is typically not how real world economic issues work.

It's like in high school chemistry, when you're taught the Bohr model of the atom (discrete little ball-like electrons orbiting a nucleus). Which is wrong. That's not what the structure of an atom is really like, or how electrons behave. But is the way that intro students can be introduced to key concepts at a time when they are nowhere near ready to learn how quantum physics works. The stuff you're taught in Econ 101 are stylized models of economic principles and how macro- and micro- economics works - but it's simplified to the point of being wrong. It's when you get to Econ 102 and Econ 201 and so on that you learn why those simplified concepts don't accurately describe real-world behaviors.
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This community has written 86,214 posts about US Policy. The article-length ones it recommended most:
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