Professor Meltzer today predicts that inflation is coming. In explaining his prediction, he takes a negative tone.
I do not agree with his tone. Some inflation would be efficient right now, because it would raise housing prices without raising housing relative prices. Raising housing prices would alleviate some of the serious problems with settling old mortgages. But leaving housing relative prices to market forces would help avoid over-building going forward.
Inflation would also help banks that own lots of mortgages. Because banks have a huge influence on the Fed, and because now inflation would help more than it hurts, I agree with Professor Meltzer's prediction that inflation is coming. My disagreement with him regards his evaluation of the inflationary outcome.