cryptonomics | the economics of crypto-markets
I haven't had time to do much blogging lately. But I have been studying the recent burst of inflation and thinking of how to interpret what we're experiencing. As is my way, I decided to write down a little model (a dynamic general equilibrium model) to help organize my thinking on this question. Below, I summarize the interpretation stemming from the model (available on request). Because it's a model, it does not capture everything that one might think isimportant. But I think it certainly captures some of
Introduction
In February 2020, the month before the full effects of the pandemic were felt in the United States, PCE and CPI measures of inflation were running between 1.7% and 2.4%, consistent with the Federal Reserve's official 2% target inflation rate. From March 2020 to February 2021, these measures of inflation declined significantly, with most measures falling below 1% in May 2020, before recovering to somewhere near 1.5% by February 2021. In March 2021, measures of inflation began to rise sharply and significantl
cryptonomics | the economics of crypto-markets