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Why Inflation Is Lower Than You Think

Most people get inflation all wrong - it is not an increase in prices. An increase in prices is merely an indicator of inflation (however, increased prices are not always a result of inflation.) Oil and food prices went up? So what, this can be attributed just as much to an increase in demand from China (or other emerging markets) as an increase in the money supply. Hence the total increase in prices of these goods is not sorely the result of inflation.