Famous Inflation Quotes

Unskilled and Unaware of It: How Difficulties in Recognizing One’s Own Incompetence Lead to Inflated Self-Assessments.” This is the famous study by David Dunning and Justin Kruger of Cornell University in New York mentioned a few chapters ago that launched the new science of what we might call Stupidology. It

The “German problem” after 1970 became how to keep up with the Germans in terms of efficiency and productivity. One way, as above, was to serially devalue, but that was beginning to hurt. The other way was to tie your currency to the deutsche mark and thereby make your price and inflation rate the same as the Germans, which it turned out would also hurt, but in a different way. The problem with keeping up with the Germans is that German industrial exports have the lowest price elasticities in the world. In plain English, Germany makes really great stuff that everyone wants and will pay more for in comparison to all the alternatives. So when you tie your currency to the deutsche mark, you are making a one-way bet that your industry can be as competitive as the Germans in terms of quality and price. That would be difficult enough if the deutsche mark hadn’t been undervalued for most of the postwar period and both German labor costs and inflation rates were lower than average, but unfortunately for everyone else, they were. That gave the German economy the advantage in producing less-than-great stuff too, thereby undercutting competitors in products lower down, as well as higher up the value-added chain. Add to this contemporary German wages, which have seen real declines over the 2000s, and you have an economy that is extremely hard to keep up with. On the other side of this one-way bet were the financial markets. They looked at less dynamic economies, such as the United Kingdom and Italy, that were tying themselves to the deutsche mark and saw a way to make money. The only way to maintain a currency peg is to either defend it with foreign exchange reserves or deflate your wages and prices to accommodate it. To defend a peg you need lots of foreign currency so that when your currency loses value (as it will if you are trying to keep up with the Germans), you can sell your foreign currency reserves and buy back your own currency to maintain the desired rate. But if the markets can figure out how much foreign currency you have in reserve, they can bet against you, force a devaluation of your currency, and pocket the difference between the peg and the new market value in a short sale. George Soros (and a lot of other hedge funds) famously did this to the European Exchange Rate Mechanism in 1992, blowing the United Kingdom and Italy out of the system. Soros could do this because he knew that there was no way the United Kingdom or Italy could be as competitive as Germany without serious price deflation to increase cost competitiveness, and that there would be only so much deflation and unemployment these countries could take before they either ran out of foreign exchange reserves or lost the next election. Indeed, the European Exchange Rate Mechanism was sometimes referred to as the European “Eternal Recession Mechanism,” such was its deflationary impact. In short, attempts to maintain an anti-inflationary currency peg fail because they are not credible on the following point: you cannot run a gold standard (where the only way to adjust is through internal deflation) in a democracy.

The chef stepped out of the kitchen for a chat with Aomame and noted that the wine would be on the house. “Sorry, it’s already been uncorked, and one tasting’s worth is gone. A customer complained about the taste yesterday and we gave him a new bottle, but in fact there is absolutely nothing wrong with this wine. The man is a famous politician who likes to think he’s a wine connoisseur, but he doesn’t know a damn thing about wine. He did it to show off. ‘I’m afraid this might have a slight edge,’ he says. We had to humor him. ‘Oh, yes, you may be right about that, sir. I’m sure the importer’s warehouse is at fault. I’ll bring another bottle right away. But bravo, sir! I don’t think another person in the country could have caught this!’ That was the best way to make everybody happy, as you can imagine. Now, I can’t say this too loudly, but we had to inflate the bill a little to cover our loss. He was on an expense account, after all. In any case, there’s no way a restaurant with our reputation could serve a returned bottle.

Usually adolescent rebels are quickly humbled because they overestimate their own truth and underestimate the truth of their elders. As Mark Twain famously put it, “When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years.” One purpose of youthful rebellion is to put one’s self at odds with adult authority not so much to defeat it as to be defeated by it. One opposes it to discover its logic and validity for one’s self. And by failing to defeat it, one comes to it, and to greater maturity, through experience rather than mere received wisdom. Of course, every new generation alters the adult authority it ultimately joins. But if the young win their rebellion against the old, their rite of passage to maturity is cut short and they are falsely inflated rather than humbled. Uninitiated, they devalue history rather than find direction in it, and feel entitled to break sharply and even recklessly from the past. The sixties generation of youth is very likely the first generation in American history to have actually won its adolescent rebellion against its elders. One of the reasons for this, if not the primary reason, is that this generation came of age during the age of white guilt, which meant that its rebellion ran into an increasingly uncertain adult authority. Baby boomers, already rather inflated from growing up in the unparalleled prosperity of postwar America, were inflated further by an adult authority that often backed down in the face of their rebellion. It doesn’t matter, for example, that there was honor in America’s acknowledgment of moral wrong in the area of race. An acknowledgement of wrong was an acknowledgment of wrong, and it brought a loss of moral authority—and, thus, adult authority—despite the good it achieved.

Apollo was having a difficult time finding candidates for the top spot, and Frissora would have had a hard time finding any job at any other public company. In September 2014, he had left as CEO at Hertz Global citing “personal reasons.” In fact, Hertz was in the middle of a massive accounting scandal where the rental car and equipment company was facing accusations of inflating profits. Carl Icahn had taken a near 10 percent stake and was making noise. Another hedge fund said Frissora had “lost all credibility.” To his surprise, Frissora got a call from an executive search firm just two weeks after leaving Hertz. They asked if he had interest in the Caesars job. He met with Rowan, Sambur, and Bonderman. Apollo claimed it would be a brief six-month bankruptcy, and the job would be fun. Frissora had been the CEO of two public companies, Hertz and auto parts maker Tenneco, and was new to gaming. But Hertz had gone private in a $15 billion LBO in 2006, so he had experience working with private equity. Until the accounting scandal, Hertz had prospered under Frissora. Rowan and Sambur were hoping an experienced operator could impose business discipline they believed Loveman had not.

Inflation’, wrote Milton Friedman in a famous definition, ‘is always and everywhere a monetary phenomenon, in the sense that it cannot occur without a more rapid increase in the quantity of money than in output.

Inflation’, wrote Milton Friedman in a famous definition, ‘is always and everywhere a monetary phenomenon, in the sense that it cannot occur without a more rapid increase in the quantity of money than in output.’ What

As the eminent historian Gordon Wood has pointed out, we must understand that a majority of the Articles’ most famous critics — and the later constitutional framers — were basically aristocrats in the pre-industrial, pre-capitalist sense of the word. They feared inflation, paper money, and debt relief measures because they modeled their social and economic world on the systems and tendencies of the English gentry. Their entire societal and agrarian order was at risk during the 1780s — in fact it would later collapse in the increasingly commercial northern states, only to live on in the plantation life of the antebellum South. Much of their complaint about “excessive democracy” in the new American state governments may ring hollow to modern ears, but they believed in their position most emphatically.

Old people vote. You know who votes in the swing states where this election will be fought? Really old people. Instead of high-profile videos with Cardi B (no disrespect to Cardi, who famously once threatened to dog-walk the egregious Tomi Lahren), maybe focus on registering and reaching more of those old-fart voters in counties in swing states. If your celebrity and music-industry friends want to flood social media with GOTV messages, let them. It makes them feel important and it’s the cheapest outsourcing you can get. Just don’t build your models on the idea that you’re going to spike young voter turnout beyond 20 percent. The problem with chasing the youth vote is threefold: First, they’re unlikely to be registered. You have to devote a lot of work to going out, grabbing them, registering them, educating them, and motivating them to go out and vote. If they were established but less active voters, you’d have voter history and other data to work with. There are lower-effort, lower-cost ways to make this work. Second, they’re not conditioned to vote; that November morning is much more likely to involve regret at not finishing a paper than missing a vote. Third, and finally, a meaningful fraction of the national youth vote overall is located in California. Its gigantic population skews the number, and since the Golden State’s Electoral College outcome is never in doubt, it doesn’t matter. What’s our motto, kids? “The Electoral College is the only game in town.” This year, the Democrats have been racing to win the Free Shit election with young voters by promising to make college “free” (a word that makes any economic conservative lower their glasses, put down the brandy snifter, and arch an eyebrow) and to forgive $1.53 trillion gazillion dollars of student loan debt. Set aside that the rising price of college is what happens to everything subsidized or guaranteed by the government.17 Set aside that those subsidies cause college costs to wildly exceed the rate of inflation across the board, and that it sucks to have $200k in student loan debt for your degree in Intersectional Yodeling. Set aside that the college loan system is run by predatory asswipes. The big miss here is a massive policy disconnect—a student-loan jubilee would be a massive subsidy to white, upper-middle-class people in their mid-thirties to late forties. I’m not saying Democrats shouldn’t try to appeal to young voters on some level, but I want them to have a realistic expectation about just how hard it is to move those numbers in sufficient volume in the key Electoral College states. When I asked one of the smartest electoral modeling brains in the business about this issue, he flooded me with an inbox of spreadsheets and data points. But the key answer he gave me was this: “The EC states in play are mostly old as fuck. If your models assume young voter magic, you’re gonna have a bad day.