For the love of God, inflation is *not* causing a living standards squeeze.

There's been an increase in the price of life. Life is about turning energy inputs into... energy, to heat us and feed us and make everything we want. The price of that crucial life input has gone up, relative to everything else.

Central banks around the world have chosen to let that push up inflation. Partly because it happened quickly. Partly because its effect on inflation arithmetically will drop out before a tightening would do much.

And... partly because if they had tried to stomp on the inflation they would have generated a recession. The unavoidable increase in the price of existing would have been compounded by unnecessarily weak activity.

So we could have got rid of some of the inflation, but most of it would have gone of its own accord, and the bit that didn't would go but we'd be no better off, probably worse off.

Some will lose out a lot. Like those on benefits or paying taxes fixed in nominal terms. But that's a government policy choice, not an unavoidable consequence of inflation.

I've said it a few times before, but it's worth saying again - there's a big upside to this episode for central banks, that there is some prospect of normalizing inflation and interest rates....

We may not have 'Japanified' with rates trapped forever at their floor, and control of inflation attempted only with asset purchases or conventional tax and spending instruments by govt. Avoiding Japanification is good!