Commentary
There are many excuses often used to explain inflation. However, the fact is that there’s no such thing as “cost-push inflation” or “commodity inflation.” Inflation isn’t an increase in prices; it’s the destruction of the purchasing power of the currency.
Cost-push inflation is more units of currency going to relatively scarce real assets. The same can be said about all others, from commodities to demand and, my favorite, “supply chain disruption”: More units of currency going to the same goods and services.
The monster inflation we’ve endured these past years first arrived through asset inflation and then through consumer prices. Now, governments and statistical bodies are tweaking the calculation of the consumer price index (CPI) to disguise the loss of purchasing power of the currency, and central banks had to hike rates after the disaster created in 2020, when the massive increase in money supply went to finance bloated government spending and created the mess we live in today….