Steve H. Hanke, professor of applied economics at Johns Hopkins University and the founder and co-director of the Institute for Applied Economics, Global Health, and the Study of Business Enterprise, joins Julia La Roche on episode 81 for a wide-ranging conversation on the economy.

Three years ago, using the quantity theory of money — which links asset prices, economic activity and inflation to changes in the money supply—Professor Hanke accurately predicted that inflation would be persistent and rise to the highest levels in a generation between 6 to 9%. Inflation topped out at 9.1%. And he expects inflation will fall to his expected range of 2.5-3% by the end of the year. He also expects that we'll enter a recession later this year or early next year.

Twitter/X: https://x.com/steve_hanke

Timestamps:

00:00 Introduction and welcome Professor Hanke

01:05 Big picture, macro view, Quantity Theory of Money

06:20 Inflation headed to 2.5-3% zone by year-end, sees recession ahead

07:40 Grading the Federal Reserve's policies, they get an 'F'

12:40 How the money supply works

16:21 Inflation below 2%?

17:30 Debt and deficit

21:52 Need for a Constitutional amendment to control government spending

23:48 End game if we don't address the debt situation

24:44 A fiscal illusion