Milton Friedman on Inflation and Money Supply

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This clip was taken from the "How to Cure Inflation" episode of the original Free To Choose TV series.

Inflation results when the amount of money printed or coined increases faster than the creation of new goods and services. Money is a "token" of the wealth of a nation. If more tokens are created than new wealth, it takes more tokens to buy the same goods. Friedman explains why politicians like inflation, and why wage and price controls are not solutions to the problem. Friedman visits Japan, U.S. and Britain.

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Why is there no one out there today like Milton that can explain these things so quickly and easily? 🤔

jeffwelker

Love Milton Friedman, could listen all day.

capoman

So the reason why inflation is so so bad in the US, where there are many examples of goods and services being exorbitantly more expensive compared to 30 years ago while the average pay rate is not even close to the percentage of thr price increases, is because just like the last 4 presidents we've had just keep begging the National Reserve to print money?

RoomerJ

In australia back when we had certain PM, whose government led us into a recession, a recession that we had to have, we’re the exact words he said. While at the same time floating the australian dollar on the stock market, which at the was almost dollar for dollar to the american green back, which now nearly every country has to deal with, the Australian dollar is worth virtually nothing against virtually every other currency. And at present, inflation is running rampant, and the very same political corporate government is telling us that inflation is world wide, and there is nothing they can do about it, and in the meantime the useless pm of the day is gallivanting around entertaining and encouraging foreign investors, companies and governments that the land down under is open to their plunder of land and resources. Isn’t that great. Lol.

ronaldmaxwell

Too many "dollars" chasing too few products and services--no different than many bidders at an auction.

johngranato

Tell that to Congress and the Department of Defense.

seer

passed As-level eco with an A grade but only now do i understand why they would print so much money when it was obvious it would lead to inflation. haha

iamdabossofnepal

A Friedman and Sowell or Friedman and Paul ticket would have been nice. Mr.
Friedman would never have run with Mitt.

Ostrya

There are folks that are of the liberal mindset that Ronald Reagan made more tax increases due to a number of factors. What Reagan had to fight his entire first term along with Paul Volker was rampant inflation that went sky high during the Carter administration. I don't know if voters would be patient enough to give a President a second term if they had to endure those countermeasures that made the economy Rocky

curtisclayton

Johnson/Friedman 2016!! (David Friedman)

shrinkthegovt

Everything these days is price fixes, so we’ll have shortages instead of inflation, with hyperinflation on a back market like amazon or eBay sellers.

astrahcat

Inflation of the money supply lessens the value of the currency so more of it is needed to buy the same amount of goods.

joeharris

If aggregate supply capacity in the economy increases at the same rate as the money supply, will inflation occur?

lachlanhyde

The fact that the average pay 45 years ago, 4.00 an hour, would have the purchasing power today of 25.00 an hour. Compared to the current minimum and current average in the US, 45 years ago your purchasing power wast 13 percent more with the same amount as today. People making much less than the current average of 23.00 an hour, which I can't believe that to be true, or even minimum wage, would have an impossible task of living. It simply cannot be done.

RoomerJ

Such a simple Civics lesson. I just need to stock up on lots of food because food prices will go through the roof. We are headed for a bad fall and if you ever see these animals go crazy on Black Friday sales can you imagine what heinous acts of violence that will descend upon these animals when there is not food in the supermarkets?

johnwayne