You understood partially how inflation is a tax. The brackets do move up, but never enough, and that is in all countries... He was always also very quick to point out that government issued debt is just a scam basically, because since government controls money supply, they are always getting more and paying effectively nothing.... But, as the saying goes(and he was the one who said it): "There is no free lunch". So who pays the bill? The people through decreasing purchasing power, which is only counterbalanced by progress in the private sector(the basics of life get cheaper as science and technology advances increasing quality and productivity of goods and services). And worse of all, the biggest problem is that money issuing by government is always uncontrolled(which is what motivated this lecture of his and motivated the book which he considers his most important work, "A monetary history of the United States"(we'll get to the book again in a minute), so it is always destabilizing the economy. He makes it clear that inflation is a disease and since the ONLY SOURCE OF INFLATION is money printing, that should be stopped. The only reason why this illusion that government issued money has to be printed to prevent recession is because it is like a drug. The moment it is printed, it gives a false feeling that everything is good. The rise in prices and consumption, even though moderate initially, make people invest in response to that rise, but since the rise is based on more money offer and not real demand for goods and services, eventually the expected demand doesn't show up and businesses start to fail. At that point, if things were left to adjust themselves, as he points out in the video, it would be a tough time. He says that there is no way around this, you have to go through a bad period in order for everything to stabilize and that will mean losses and unemployment. But, as with drug addicts, after a rough period of abstinence, we would finally be free from the drug. The problem is that, as with all addicts, what happens is that another dose of the drug is given and the false feeling that "things got better" comes back, reenforcing the idea that the drug is needed. He says that if the will to do that AND GO THROUGH WITH IT is not found, things would be in an endless cycle of huge up and down swings(which turned out to be true, 2008 being the best example of it). This is what Thatcher was trying to do and to this day there are idiots who say that she caused unemployment and recession, when in reality, that was the side effect of the correct "treatment" she was willing to do.
He says that the FED's inability to print money caused the 1929-1933 crisis, but this is one of the most discussed things by him: even though that is true, the situation the led to the crisis in 1929 was caused by the FED. Essentially, if there was no FED, there would still be swings, but lighter. This is completely contrary to "common knowledge" today, which says that before the FED, things were less stable. This is where the book I mentioned is so important. He revised 93 years of monetary history, about 47 of which through balances and documents from the FED and he basically shows how these times were less stable and not more after it's creation.(As a side note, this is one of the books that got him the noble prize). In it, he mentions what I mentioned in the very beginning if this thread: "That there were at least two periods in the history of the US where money supply was not enough to track goods and services. That resulted in deflation as a mere equilibrium response and these were periods of very high GROWTH in the economy."
But one thing I give you is this: It was indeed the 70's 80's and that means that there were no cryptos back then.. So his options were very limited... He suggested things like "fixing the money supply by law", which could only be curbed by congress, which we know doesn't work, given the always growing "debt ceiling" approved by congress(and the debt ceiling was also one of his ideas to control this). So he was stuck, because he essentially needed people to understand these things in order to effectively "go through the treatment and cure the disease".
That's why I posted in the beginning if the thread too the video where he mentions cryptos many years later. And the beauty of cryptos is essentially this: it makes in the own self interest of people to act in a way that finally we can get rid of government issued money and given the already mentioned problems of government having this power, this will finally lead us in this direction, with no need for people to understand all this.
