expectations.............................

      But this breathtaking increase in the money supply did not, at least immediately, set off inflation.  For while inflation is a monetary phenomenon, it is also a psychological one: when the expectation of inflation becomes widespread, it becomes a self-fulfilling prophecy.

     That prophecy was fulfilled in 2021.  With the Biden administration continuing pandemic relief, which discouraged many for seeking work, and restricting oil and gas production, inflation set in.   Supply chain issues also contributed.

     By December 2021, consumer prices were up seven percent on an annual basis, the highest in 40 years, while producer prices were up 9.6 percent, the highest since that statistic has been compiled.  And the expectation of further inflation is now deeply embedded in the economy.

     Regardless of this, the Biden administration is still pushing hard for its "Build Back Better" plan, which would add at least another $5 trillion to the national debt over the next decade.  And President Biden has airily said that "Milton Friedman is no longer in charge."

     But unfortunately for the Biden presidency—and for the American people—Milton Friedman was right.  Create too much money and you get inflation.  We are witnessing the proof of that right now.

-John Steele Gordon, as he concludes this essay