The wickedness of inflation and why it continues to be official policy

Whilst individuals have received a rude awakening of the problems that come with high inflation—namely being an increase in the cost of living—its ills stem far further than that.

Inflation has many pernicious qualities, including contributing to: an increase in speculatory activity and asset bubbles; encouraging excessive debt and living beyond one’s means; widening wealth inequality and delivering the hardest hits to those who can least afford it; and the misallocation of resources that later requires a painful economic correction.

Yet despite all of these problems, the very foundation of the world’s economic system, is by design, made to generate inflation.

An increase in speculatory activity and asset bubbles

In order to understand how inflation promotes speculatory activity and asset bubbles, one needs to understand how inflation is created, which is principally by increasing the money supply. When new money is printed, there is suddenly more money available to spend on a given good …