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To: TH who wrote (241173)	3/16/2010 6:42:56 PM
From: GST	Respond to of 306849

I am not saying that matching money supply growth to economic growth is a piece of cake -- I am saying that it is absurd to deny that non-inflationary money growth and economic growth can and should go hand in hand. I am merely railing at the religious fanatics who think that money supply growth is the hand of the devil, and even crazier, that inflation has nothing to do with prices going up. Money is both a medium of exchange and a store of value. As a medium of exchange, it matters less what level the supply is at -- just like stock splits do not increase or decrease the value of a company. But as a store of value it does matter -- and it matters a lot. This is where we are now in trouble -- the dollar is not a reliable store of value because the fed now has no choice but to bomb the value of the dollar in order to dilute the impact of foreign debt that can never be serviced let alone repaid. Those, like Mish, who do not know what money is for or what inflation is, and who do not know the impact of a falling dollar or the impact of foreign debt and the current account deficit of the US, have nothing worth listening to in my opinion on core issues like inflation.