79-Are Tariffs Inflationary or Deflationary?
Description
Lots of confusion again on whether Tariffs cause inflation or notThey do drive up the prices obviouslyBut how come people say no inflation?Because there exists two definitions of inflation:A. immediate rise in price level: absolutely caused by tariffs. Tariffs raise prices. But in the absence of new money, some other consumer expenditure will be sacrificed to cover the tariff costs. Then economic slowdown-down (still bad but not traditional definition of inflation). Then the slow-down actually ends up causing deflation (less econ activity, money supply shrinks)B. a long-term and permanent increase in prices: not caused by tariffs. Only caused by money printing. Supply shocks and tariffs are not inflationary in this sense and are instead deflationary.---Book a free consultation: https://21stCapital.com/nostr---Follow Sina on X: https://x.com/Sina_21st
United States
