Money and Inflation at the Time of Covid
Published on 21. October 2025
Book
Hardback
292 pages
978-1-0353-2896-3 (ISBN)
Description
How is the inflation flare-up of the early 2020s to be explained? In this book Tim Congdon, one of the world's leading monetary analysts and Fellow of the Royal Economic Society, argues that a money growth explosion in spring and summer 2020 was the main cause.
The book is scholarly, but also lively and readable. Congdon restates the quantity theory of money, advocating the usefulness of a broadly-defined measure of money which includes all, or nearly all, bank deposits. He applies this theory to the macroeconomic events of the early 2020s, and debunks the widespread view that inflation was caused by unforeseeable supply-side shocks.
In spring 2020 Congdon was almost unique in forecasting the inflation flare-up. His position contrasted sharply with the overwhelming majority of economists who instead believed that Covid-19 would lead to several years of disinflation. Congdon was right and nearly all of his profession was wrong. Congdon is very critical of leading central banks, particularly the USA's Federal Reserve.
Money and Inflation at the Time of Covid is a brilliant challenge to conventional macroeconomic thinking. It provides vital insights into recent events for students and academics in economics and finance, as well as economists, policymakers and other practitioners working in financial institutions, companies and consultancies.
The book is scholarly, but also lively and readable. Congdon restates the quantity theory of money, advocating the usefulness of a broadly-defined measure of money which includes all, or nearly all, bank deposits. He applies this theory to the macroeconomic events of the early 2020s, and debunks the widespread view that inflation was caused by unforeseeable supply-side shocks.
In spring 2020 Congdon was almost unique in forecasting the inflation flare-up. His position contrasted sharply with the overwhelming majority of economists who instead believed that Covid-19 would lead to several years of disinflation. Congdon was right and nearly all of his profession was wrong. Congdon is very critical of leading central banks, particularly the USA's Federal Reserve.
Money and Inflation at the Time of Covid is a brilliant challenge to conventional macroeconomic thinking. It provides vital insights into recent events for students and academics in economics and finance, as well as economists, policymakers and other practitioners working in financial institutions, companies and consultancies.
Reviews / Votes
'Congdon was among the very first to spot the inevitably inflationary consequences of monetary policy's botched response to the Covid pandemic, and this is his well-deserved "I told you so". His contemporary diagnosis was spot-on, and his book is required reading for anyone who wants to understand this turbulent episode.' -- David Laidler, University of Western Ontario, Canada 'Tim Congdon - the Dean of the Quantity Theory of Money - has put together a historic quantity-theory-based treatise on money and inflation in the time of the Covid-19 pandemic. Congdon's fluency in the language of financial markets and mastery of macroeconomic theory and the history of economic thought make this book required reading.' -- Steve H. Hanke, Johns Hopkins University, USA 'Tim Congdon has been right when the consensus was wrong on risks of inflation, notably during the "Lawson boom" of the 1980s in the UK and the post-pandemic inflation of recent years. This makes his determination to update and defend the quantity theory of money brave and valuable. His recent writings are a reminder of the theory's continuing relevance.' -- Martin Wolf, Chief Economics Commentator, Financial Times 'Congdon takes advantage of the recent close relationship between the monetary surges in 2020 and subsequent inflation to argue that large-scale deviations of (broad) monetary growth from trend are likely to cause related fluctuations in both asset and general prices. He makes a strong case in a splendid, combative book.' -- Charles Goodhart, London School of Economics, UKMore details
Language
English
Place of publication
Cheltenham
United Kingdom
Target group
Professional and scholarly
Dimensions
Height: 234 mm
Width: 156 mm
ISBN-13
978-1-0353-2896-3 (9781035328963)
Copyright in bibliographic data and cover images is held by Nielsen Book Services Limited or by the publishers or by their respective licensors: all rights reserved.
Schweitzer Classification
Person
Tim Congdon, CBE, Chairman, Institute of International Monetary Research and Professor, University of Buckingham, UK
Content
Contents
Preface
Introduction to Money and Inflation at the Time of Covid
PART I SOME BACKGROUND THEORY
1 The quantity theory of money: a new restatement
2 How this restatement differs from Friedman's
3 Can central banks run out of ammunition? The money-
equities interaction channel in monetary policy
4 Why were economists' forecasts in the Covid pandemic so
badly wrong?
PART II APPLICATIONS OF THE THEORY IN THE EARLY 2020s
5 The money explosion of spring 2020, as it happened
6 Was it right in 2020 to forecast that the then money explosion
would increase inflation? An analysis of the US situation
7 Applying the theory to the USA in the early 2020s
8 Applying the theory to the UK in the early 2020s
9 Does cost accountancy provide a good framework for
analysing inflation?
10 Money in the Covid-related business cycle: an analytical
narrative and key evidence
Preface
Introduction to Money and Inflation at the Time of Covid
PART I SOME BACKGROUND THEORY
1 The quantity theory of money: a new restatement
2 How this restatement differs from Friedman's
3 Can central banks run out of ammunition? The money-
equities interaction channel in monetary policy
4 Why were economists' forecasts in the Covid pandemic so
badly wrong?
PART II APPLICATIONS OF THE THEORY IN THE EARLY 2020s
5 The money explosion of spring 2020, as it happened
6 Was it right in 2020 to forecast that the then money explosion
would increase inflation? An analysis of the US situation
7 Applying the theory to the USA in the early 2020s
8 Applying the theory to the UK in the early 2020s
9 Does cost accountancy provide a good framework for
analysing inflation?
10 Money in the Covid-related business cycle: an analytical
narrative and key evidence