A Different Story Of Inflation With John Cochrane
Capitalisn't
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Fiscal Theory of the Price Level
Inflation comes when people say, ah, this is not going to end well. They try to spend them individually and collectively somebody's got to hold them. The only thing we can do if we don't really trust this government debt is try to spend it - thereby driving up the price of everything else. That's the basic fiscal theory of the price, though, whereas the monetary view takes that distinction between money and bonds and puts it at the base of everything.
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