Brian: This is a guest post by Professor Louis-Philippe Rochon of Laurentian University, who was looking for a venue to publish this piece. I have seen his presentations at some Post-Keynesian conferences, and I am happy to pass this article along. Fact: inflation around the world is on the rise.
While I find this post thought-provoking, it is largely unsourced and would need a lot of work to stand up to criticism if it were circulated more widely. One example:
"Inflation has always been considered public enemy No. 1, as it diminishes the value of Wall Street wealth. For that reason alone, central banks, who depend on the approval of Wall Street for their legitimacy, will never let this group down."
While inflation does mean that banks who extended fixed-rate loans will be paid back in "cheaper" dollars, does that necessarily "diminish the value of Wall Street wealth"? Wouldn't it be reasonable for the big Wall Street players to be able to profit from all kinds of macro scenarios?
More specifically, have we observed this happening in past inflationary periods, e.g., the 1970s?
While I find this post thought-provoking, it is largely unsourced and would need a lot of work to stand up to criticism if it were circulated more widely. One example:
"Inflation has always been considered public enemy No. 1, as it diminishes the value of Wall Street wealth. For that reason alone, central banks, who depend on the approval of Wall Street for their legitimacy, will never let this group down."
While inflation does mean that banks who extended fixed-rate loans will be paid back in "cheaper" dollars, does that necessarily "diminish the value of Wall Street wealth"? Wouldn't it be reasonable for the big Wall Street players to be able to profit from all kinds of macro scenarios?
More specifically, have we observed this happening in past inflationary periods, e.g., the 1970s?