But the banks' intervention is only instrumental. They merely expand credit for the benefit of the government. In other words, they increase the quantity of money substitutes. There is then no increase in the total quantity of currency or credits available and hence no inflation. The term is merely a phrase indicating the limits within which the law is prepared to tolerate credit expansion, that is to say further inflation.
Popular education is absolutely essential.
It is clear that the efforts of the U.S. government to collect the means necessary for the conduct of the war by taxation and by sale of government bonds represent sound measures for heading off inflation. Everybody should be made to understand that the burden of high taxes and of making personal loans to the government are minor evils compared to the disastrous and inexorable consequences of inflation. Nationwide price, wage, and rent controls continued throughout the war, but were ended shortly thereafter. However, some cities chose to continue rent controls thus distorting the market and prices, and producing persistent shortages of rental housing in those localities. Database Programming, Site Design and Hosting IWDC, Inc.