Can we still avoid inflation?

“Can we still avoid inflation?” In Richard M. Ebeling (ed.) The Austrian Theory of the Trade Cycle and Other Essays. New York: Center for Libertarian Studies (Occasional Paper Series 8) 1978.


“In one sense the question asked in the title of this lecture is purely rhetorical. I hope none of you has suspected me of doubting even for a moment that technically there is no problem in stopping inflation. If the monetary authorities really want to and are prepared to accept the consequences, they can always do so practically overnight. They fully control the base of the pyramid of credit, and a credible announcement that they will not increase the quantity of banknotes in circulation and bank deposits, and, if necessary, even decrease them, will do the trick. About this there is no doubt among economists. What I am concerned about is not the technical but the political possibilities. Here, indeed, we face a task so difficult that more and more people, including highly competent people, have resigned themselves to the inevitability of indefinitely continued inflation.”

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