The inflation in 2022-2023, which has now resurfaced was attributed to the Russia/Ukraine war raising oil prices and COVID supply chain shocks. I contend that these events, while disruptive, have been scapegoated and that the real cause is the Reserve Bank of Australia (RBA) and the Australian federal government spending.

• From April 2020 to December 2021 the RBA purchased $310 Billion in Australian government federal debt. When a central bank buys government debt, they do it with newly ‘printed’ money; money essentially created out of thin air. This equivalent to $300 000 per minute being created!

• In April of 2020 alone, the RBA accounted for 89% of new bond purchases at a time that no one else was willing to lend money to governments.

• The total M3 money supply (ignore the economic jargon) in the economy grew from $2.1 Trillion in January 2020 to $2.7 Trillion by April 2022. That represents a 30% increase in a little over two years. Concerningly, our current money supply is still larger at $3.4 Trillion in May 2026, and is growing at 7% per year.

So when your reflecting about how everything costs more now and it doesn’t seem like your money is worth nearly as much as it used to, its because it doesn’t. Businesses have always been greedy, and consumers have always been spendthrift, that will never change. Supply chain disruptions and oil shocks can cause temporary increases in prices. But the persistent and appreciable increase in the Australian price level since 2020 is due to the RBA creating money out of this air, mostly to finance our federal government.