Price is rising rapidly. This is what we call excessive currency issuance as the fundamental cause of long-term inflation. Excessive currency supply will cause excess liquidity, and excess liquidity will cause Overheating of investment and the possibility of inflation.

Inflation is the depreciation of a country's currency that causes rising prices. The essential difference between inflation and general price increases: General price increases refer to a temporary, partial, and reversible increase in prices of certain commodities due to an imbalance in supply and demand, and will not cause currency depreciation; inflation can cause a country's currency to depreciate. The prices of major domestic commodities in the country have continued, widespread and irreversible increases.

The direct cause of inflation is that the amount of currency in circulation in a country is greater than the total effective economic aggregate of the country. The direct reason why the amount of currency in circulation in a country is greater than the country's effective economic aggregate is that the growth rate of a country's base currency issuance is higher than the growth rate of the country's effective economic aggregate.

The reasons why the growth rate of a country’s base currency issuance is higher than the growth rate of its effective economic aggregate include both monetary policy and non-monetary policy. Monetary policies include loose monetary policies and the use of interest rates and exchange rates to regulate the economy; non-monetary policies include indirect investment and financing-led financial systems causing loan expansion, long-term excessive export surpluses in international trade, excessive foreign exchange reserves, speculation, monopoly, corruption and waste Raising social transaction costs reduces the quality of economic development, causes imbalances in the economic structure, and misleads consumption expectations.

So inflation is not just a monetary phenomenon, real economic bubbles are also an important cause of inflation. Regardless of whether it is monetary policy or non-monetary policy, monetary phenomena or real economic bubbles, the fundamental cause of inflation is that the GDP growth pattern results in excessive GDP moisture, excessive ineffective economic aggregate, and a serious lack of effective supply, resulting in reduced monetary efficiency.

When the prices of most goods and services in an economy continue to rise in price levels in different forms (including explicit and implicit) for a period of time, macroeconomics says that the economy is experiencing inflation. Following this explanation, if the price of just one good increases, this is not inflation. Only if the prices of most goods and services continue to rise.

The explanation of inflation in the economics community is not completely consistent. The concept generally recognized by economists is: under the credit currency system, the amount of money in circulation exceeds the actual needs of the economy, causing currency depreciation and price changes. Comprehensive and sustained rise in levels. In layman's terms, the issuance of banknotes exceeds the quantity required in circulation, which causes the devaluation of banknotes and the rise in prices. We call this phenomenon inflation.

The price increase in the definition does not refer to the increase in the price of one or several commodities, nor is it a temporary increase in the price level. It generally refers to the sustained and widespread rise in the price level within a certain period of time, or in monetary terms. A continuous decline in value over a certain period of time.

It can be seen that inflation does not refer to the increase in the price of this or that kind of goods and services, but the increase in the overall price level.

The overall price level or general price level refers to the weighted average of the total transaction prices of all goods and services. This weighted average is the price index.

There are generally three price indexes for measuring inflation: consumer price index, producer price index, and gross national product price conversion index. Simply put, when the government prints too much money, prices rise.