The Continental Economics Institute Currency Review
Saturday, March 24, 2012
When inflation explodes right into your face
Amity Shlaes explains:
"... The thing about inflation is that it comes out of nowhere and hits you.Monetary policyis like sailing. You’re gliding along, passing the peninsula, and you come about. Nothing. Then the wind fills the sail so fast it knocks you into the sea. Right now, the U.S. is a sailboat that has just made open water, and has already come about. That wind is coming. The sailor just doesn’t know it.
“Sudden” has happened to us before. In World War I, an early version of what we would call theCPI-U, theconsumer price indexfor urban areas, went from 1 percent for 1915 to 7 percent in 1916 to 17 percent in 1917. To returning vets, that felt awful sudden...."