[Baltimore Sun] A lot of inflation talk doesn’t add up | READER COMMENTARY
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Can we have some common sense talk about inflation? The textbook cause of inflation is “too much money chasing too few goods.” We’ve had both. The supply chain squeeze due to COVID-19 resulted in too few goods. The money distributed to both businesses and individuals by both the Donald Trump and Joe Biden administrations, with Congressional approval, produced too much money (“Economy, especially inflation, top concern for voters this election,” Oct. 17).
So, the result was inflation. But the money handed out probably prevented a recession, which would have inflicted more harm than inflation. Now, the level of inflation is back to normal. However, don’t expect prices to roll back to their 2019 levels. That doesn’t happen. And it would be a bad thing if it did — it would surely induce a recession. Think about it. If you knew prices were dropping, what would you do? Not spend. You’d wait until prices dropped lower, which would send the economy into a tailspin.
— Wes Michael, Towson
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