How Money Printing Made Supply Chain Disruptions Even Worse | Nicholas Baum

That is, although we’re indeed witnessing a large spike in demand (which is perhaps best quantified by changes in nominal GDP), this increase in demand is a symptom of a larger problem: the massive expansion of the money supply under the watch of the Federal Reserve and the White House. The implications of this unprecedented expansion are two-fold, not only stirring this increase in “demand” but contributing to supply chain issues through the distortion of price signals. With state governments responding to the rise of Covid-19 by imposing lockdowns and forcibly closing “non-essential businesses,” both the Fed and the Trump and Biden Administrations stepped in with an extraordinarily expansive monetary and fiscal policy, respectively.