How Inflation Undermines Culture and Values

Inflation has come to be one the defining economic phenomena of this generation. As the money supply grows seemingly without end, it’s easy to miss how the erosion of our money wreaks both economic and – more subtly– cultural havoc.

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

In the previous article, I discussed the social consequences of the welfare state; now I want to focus on inflation—or more precisely, on central bank policy. Inflation can broadly be defined as an artificial increase in the money supply that ultimately drives up prices, but this definition overlooks the fact that it is a process in which prices first rise in the capital goods of industries furthest from final consumption and then gradually spread throughout the entire system. Therefore, in an inflationary process, there are a few winners who reap substantial profits, and many losers whose purchasing power declines.