Inflation's a bit odd anyway

Well, it is. An economy is going along nicely, growing at record rates, but then stop, everyone, inflation is ten percent, so we will have to hike interest rates and slow down the economy. Sorry, poor and rich alike, you'll have to wait for a few more decades before reaching your potential wealth, no matter how hard you are willing to work for it.

All because inflation is too high. Or, prices are increasing too quickly. Or, the artifice termed money which is used to denominate the economy has acquired a particular abstract mathematical quality which results in the economy breaking down if it is sustained.

It is like this: you have a car whose engine overheats if it goes faster than ten miles an hour. The smart solution is not to limit the speed to ten miles an hour, but to invent a cooling system. Someone should invent a cooling system for the economy.

It may be argued that the economy can grow rapidly without inflation if there is productivity growth rather than just frenzied economic activity, which is true. But frenzied economic activity still leads to real economic growth, and it would be nice to have it without having to slam down the brakes. If the problem is money creation through debt issue, so that inflation is not the problem in itself but the debt accompanying it, and the growth is likely to be evened out by future contractions, then that should be dealt with directly, rather than by inflation targeting primarily. At least the difficulties should be named correctly.

I think I have assumed the "capitalism in itself can cause inflation" point noted in my last post, and that's OK.