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Saturday, April 16, 2016
What is the Austrian reason why unemployment and inflation are inversely correlated?
I think this is the reason: 1. Banks have to make fewer retails loans because people are unemployed. 2. This leads to a lower demand for new money created through government spending. Nobody needs fiat to pay back debts, because people borrow less because banks lend them less because they have no jobs to pay back said debts. What do you think?