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How does an economy with no inflation/deflation function?
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John Burns
Posted 12/27/2013 07:48 (#3550063 - in reply to #3549700)
Subject: economy growth



Pittsburg, Kansas

The economy growing or shrinking has no relevence to money supply.

With a fixed money supply prices adjust accordingly (up or down, depending on supply/demand). In our current financial system, a group of people try to decide what the proper supply of money is to try and keep prices the same. One way is free market determining the value of goods. The other way is central planned prices.

Try this on for size. Proper supply of money

John

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