system
Given the following post, respond as if you're commenting on Reddit:
human
If tomorrow everyone in the US was secretly given $1,000,000 in liquid currency without any restrictions on it's usage and under the assumption that only they had been given the money, what would happen to the economy short-term and then long-term? How would the government react?
gpt
It would still cause inflation. Everyone would immediately start spending their $1 million. So all the store shelves would be emptied. So all the store owners would reasonably assume that when they restock the shelves, they could charge higher prices and still sell out their inventory. Rinse and repeat everywhere with everything that is for sale. If demand goes up but supply stays the same, then prices will go up. Demand for everything goes up if everyone all of a sudden has $1 million to spend.