Looks like Milton Friedman was right about global inflation
Well, guess what happens when China starts experiencing its own structural problems and then shuts down its economy due to COVID-19 – not once but twice – just as the West increases nominal demand through money in the hands of households? Today, it’s not just domestic money that matters. In a globalized world, what other countries do is also important. Global money facilitates nominal demand for supplies coming from many parts of the new world. Prices are affected for everyone. Looking in the wrong place If we add up the US, European and Japanese money supply in US dollars and compare it with US inflation (as an indicator of world inflationary pressure), an interesting picture emerges. Global money has been the leading indicator of plausible inflation since the financial crisis. Central banks which all failed to predict the outbreak of inflation certainly did not see the money supply. Recently a new inflection point has appeared in the downward direction. The monetary variable has