system
Given the following post, respond as if you're commenting on Reddit:
human
Reduce inflation by reducing money supply?

I’m probably being a moron but if inflation is caused by money becoming less valuable, can’t the government just reduce the amount of money in circulation to make its value increase?  
  
What if the government sold a ton of assets to the banks. The banks would pay with cash. The government would then hold onto that cash, keeping it out of circulation. Money is therefore more scarce, making the value of any unit of money increase.  
  
I’m sure there is an obvious answer to why it isn’t as simple as this, but I know almost nothing about this stuff so would love to understand it if someone can ELI5. Thanks.
gpt
No it's literally that simple and that's pretty much what governments do.

Or rather, they control inflation by controlling the "speed" of money creation.

Think of it like that, if you're driving a car, you don't always slam on the brakes to reduce speed, letting go of the throttle, or simply pressing the throttle down *less* can also reduce your speed depending on the circumstances.

It's the same with money creation. The central bank could slam on the brakes and halt inflation very quickly or severely, or it could also just *slow down* money creation and also reduce inflation.

That matters because creating more money causes inflation by causing an increase in aggregate demand. People have more money, people want to buy more stuff, and prices go up.

Consequently, the same goes for the other direction. If the central bank would shrink the money supply super aggressively, that would lead to a sharp fall in aggregate demand, and most likely crash the economy. The central bank doesn't want that, so it applies the throttle more gently.