Finance & Fury Podcast

Welcome to Finance and Fury, the Furious Friday edition. In today’s episode I want to explore the effect of monetary inflation (in other words the increase in the money supply) on GDP growth Covered GO compared to GDP in Wednesdays episode this week - To go one step deeper – want to look at the fact that nominal GDP looks to be directly inflated by additional money introduced into an economy – essentially in the form of credit – therefore - GDP growth is simply a reflection of additional money introduced into the economy And if this is the case - GDP is really not a good macroeconomic tool to use to make policy decisions – as it gives no real indication as to the underlying health or real growth of an economy – as it can just be artificially inflated whilst having debt elsewhere that offset the real growth   This may come as a bit of a surprise – it did to me when looking at some of the figures – as it is rare to find any economists covering the relationship between monetary expansion and GDP Yet – there