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A Monetary Debate: Is Sustained Inflation Coming? Is Powell Delusional?

Professor Steve Hanke calls Powell delusional over "transitory inflation". He believes it will be sustained.
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Inflation's Ups and Downs

Sustained Inflation?

"Powell Is Delusional"

"Powell is delusional. The explosion in the US money supply means that there will be sustained inflation."

Really? 

Money Supply Measures

Money Supply Measures 2021-05

M2 Money Supply vs the CPI

M2 and CPI Percent Change

The above chart suggests there is no relationship at all between consumer prices and money supply. 

Inflation Calls

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We have been seeing inflation calls from the same people for decades. Finally the CPI is rising.

But the CPI is a very poor measure of inflation. It's not even a good measure of prices. 

Distortions Abound

On July 16, I wrote The CPI Measures Inflation and Other Widely Believed Economic Nonsense

"The CPI is a piss poor measure of inflation." And It's not even a good measure of prices. 

Is money finally influencing consumer prices more so than assets? For how long? What's "sustained"?

Is inflation transitory? That's the question on everyone's mind.

 "What Would it Take for Me to Change my Mind on Inflation?"

On June 30 I addresses a reader question: "What Would it Take for Me to Change my Mind on Inflation?"

Since then I have identified one more thing. I will discuss that in a subsequent follow up post.

Mish