Amazon’s Genius Mocks the Fed and Its 2% Inflation Target

Originally Published in Real Clear Markets on 8/28/17.

Amazon’s purchase of high-end grocery retailer Whole Foods was approved last week. That the federal government had any role at all in the combination of two private companies is on its own an offense to common sense. Government barriers erected to mergers trample on property rights, restrain economic progress for crucial information about the good or bad of tie-ups needlessly reaching markets late, plus readers must consider the unseen: the economic activity not taking place thanks to the forced duplication of effort that is an effect of antitrust.

But this is a column about the Federal Reserve, and the alleged price-level implications of the Amazon/Whole Foods tie-up. Sometimes commentary is remarkable for its absurdity, and that was certainly the case last week.

With approval of the merger having been given, Amazon quickly announced that shoppers would soon see reduced prices at Whole Foods. Good news? Actually, news like this should be put in the wonderful category. Our work is all about the getting. Thanks to innovators like Amazon, we’re able to get more and more in return for our work. All is well? Not really, if an impressively obtuse post from Bloomberg is to be believed.