I actually agree that price rises like oil are not really inflation - what Keynes would call semi inflation. Regardless, oil price rises were not due to money supply and the subsequent monetary shenanigans are just economic theatre (and even that is being questioned at the inner sanctum: https://www.federalreserve.gov/econres/feds/files/2021062pap... )
Honestly the 70s inflation and the 20s inflation were both caused by the same thing, supply side price shocks in oil prices.
Like inflation this time started before the Ukraine War and run up in oil prices.
Same in the 70’s, inflation had already doubled by 1970 but the oil shock didnt happen until 1973.
You could argue it makes inflation worse, but it wasnt the cause.
Oil and boomers leaving the workforce and covid derailing shipping and monetary policy and 1000 other things can all be pushing up prices at the same time.
“Inflation is a general increase in prices and fall in the purchasing value of money.”
The key is general. Increases in prices of select items due to supply or demand is not inflation.
If there are several structural issues (eg greatest workforce change in 3 generations, war in Europe, worldwide pandemic, etc) they can all contribute to a general inflationary (or deflationary) trend.
It’s a very particular economic school that says only monetary policy causes inflation. And we have years and years of loose policy that didn’t put inflation on the front burner for economists to argue about.
It doesn't. Inflation is an erosion of value of the currency.
General means "across the board" because the currency is worth less.
Sure, if there is a glut of apples and the price drops you may not notice the inflation baked into the price, but it's there.
And if there is a shortage of oranges the price may jump higher than inflation, but that doesn't mean inflation is higher.
People seem to be confusing general prices changes due to other factors with inflation. It's not inflation unless the currency is worth less.
If a central committee increased the price on everything without changing the monetary supply that would still be inflation. Similarly if the invisible hand does it or if there is broad collusion amongst producers.
If gas prices rise the purchasing power of my dollar remains the same for most items.
If inflation goes up, my dollar buys less of everything.
The example of oranges going up in price and apples down is not inflation.
Inflation is an overall erosion of buying power.
When oil prices rise that’s not inflation, although prices might rise.