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Posted by James Baird (24.61.47.204) on 08:42:42 11/19/07
In Reply to: Re: So Inflation Happens When? posted by warren mosler
: think of it this way to get started:
:
: govt spending is inflationary
:
: taxing is deflationary
:
: deficit spending is net inflationary (all else equal which it usually isn't) if the deficit exceeds non govt 'savings desires.'
:
And when people look at the problems thrid world governments have with inflation, they usually pin the blame deficit spending, when it actually is due to their inability to efficiently collect taxes. An efficient tax system is the backbone of any stable currency - but try to convince the libertarians of that!
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