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Bernstein analysts suggest the scale and social impact of the public policy response to the COVID-19 pandemic will ultimately prove inflationary

Bernstein analysts suggest the scale and social impact of the public policy response to the COVID-19 pandemic will ultimately prove inflationary
22nd Jul 20, 3:39pm by Gareth Vaughan

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3 Comments

by  treadlightly  |  22nd Jul 20, 5:17pm 1595395035

Only when spending exceeds the capacity of the economy to produce goods and services does inflation occur. It is the spending that can create inflation, regardless of the source of the money and the NZ economy is a long way from being at full capacity. The purpose of taxation is to delete currency and so maintain the value of the currency and prevent inflation and any spending greater than taxation simply adds to private savings.

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by  Kezza R  |  22nd Jul 20, 10:05pm 1595412320

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by  Audaxes  |  23rd Jul 20, 9:12am 1595452375

Does Bernstein ever check the sovereign bond market for clues to future inflation expectations?

https://www.zerohedge.com/markets/20y-treasury-prices-record-low-yield-…
https://fred.stlouisfed.org/series/T5YIFR/

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