Inflation and deflation are purely monetary phenomena. Inflation is not just a rise in prices, lots of things can drive prices higher. Inflation is the very specific case of a rise in general price levels driven by an increasing money supply. If the money in an economy grows at a faster rate than the pool of goods and services on which to spend it, general prices are bid higher as a result. Only money creates inflation. From Adam Hamilton Zeal essays
Our government has, in effect, more than doubled the amount of money in circulation with these bail outs. With companies cutting back (producing less goods) and more money in circulation inflation, I mean severe inflation is coming.
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