"Inflation is caused by greed"

published Feb 24, 2022

A deceitful explanation is always worse than no explanation at all.

"Inflation is caused by greed"

"Greed" — and its verb form "price gouging" — as explanations for inflation, are in fact deceitful non -explanations.

All parties in all markets try to maximize profit at all times. They don't suddenly "become greedy" for no reason.  Everything else being the same, if a seller charges more than the market will bear, competitors will undercut (because they're maximizing profit too, and a less-profitable sale is better than no sale).  This obvious phenomenon suppresses the price-raising effect of greed in pretty much all normal non-oligopolistic circumstances.

Thus, the underlying cause of inflation, understood as a decrease in purchasing power, must be a change in the inputs involved for that outcome.  This automatically rules out magical explanations like "greed", much to the chagrin of moronic socialist politicians and the NPCs that mindlessly parrot them.

I often like to point out that absurd explanations like "inflation happens because of greed" are analogous to the well-known 5-year-old theory of aeronautics "airplanes crash because of gravity".

Yes. Planes crash "because of gravity" in the most general of senses.  Every plane is subject to the force of gravity.  In this sense, gravity is involved in literally 100% of plane crashes.

No, this isn't the answer to "but why did this specific plane crash?". If you earnestly reply "because of gravity" to such a question, you haven't even understood what was being asked in the first place.  You certainly haven't answered that question, or even understood the need to know why.

And if you can't tell why, know this: you are unqualified to opine on the subject, and everyone listening to you is probably laughing at you behind your back.  Why?  Because you just displayed the intellect of a 5 year old in response to a question that adults were discussing.

Map what you just read to "greed causes inflation", and you've understood all there is to understand regarding that theory.

Inspired by Erik Voorhees .