  We study a game where households convert paper assets, such as money, into
consumption goods, to preempt inflation. The game features a unique equilibrium
with high (low) inflation, if money supply is high (low). For intermediate
levels of money supply, there exist multiple equilibria with either high or low
inflation. Equilibria with moderate inflation, however, do not exist, and can
thus not be targeted by a central bank. That is, depending on agents'
equilibrium play, money supply is always either too high or too low for
moderate inflation. We also show that inflation rates of long-lived goods, such
as houses, cars, expensive watches, furniture, or paintings, are a leading
indicator for broader, economy wide, inflation.
