Episode 306: Listener Questions: Contagion, Lawsuits, and Socialism, Pt. 1
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The Government Benefits From Inflation
If you start every consideration by saying the government sucks, therefore you're going to get the right answer almost all the time. And what happens here is if you're in a period of inflation, we'll say moderate inflation, right? Reasonable things. Two, three, four percent, something like that. That's right. What happens is the government has the ability ... for the government to borrow a tremendous amount of money to fund its spending. For that borrowing to be monetized, that is the central bank, the Federal Reserve prints the money.
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