The fact that inflation is not necessarily caused by the money supply was proven in the 1970s, and economists did not notice. So I started a file and began to study the oil crisis and the ensuing inflation. I never dreamed that my fellow economists would lock themselves into the groupthink that the money supply is the cause of inflation. AdvertisementWe received undeniable economic proof during the Obama years that the money supply and spending do not cause inflation. That is the largest increase in spending and money supply in our history, yet inflation did not budge.