  The subject of this study is inflation, a problem that has plagued America
and the world over the last several decades. Despite a rich trove of scholarly
studies and a wide range of tools developed to deal with inflation, we are
nowhere near a solution of this problem. We are now in the middle of the
inflation that threatens to become a stagflation or even a full recession; and
we have no idea what to prevent this outcome. This investigation explores the
real source of inflation. Tracing the problem of inflation to production, it
finds that inflation is not a phenomenon intrinsic to economy; rather, it is a
result of inefficiencies and waste in our economy. The investigation leads to a
conclusion that the solution of the problem of inflation is in achieving full
efficiency in production. Our economic production is a result of the evolution
that is propelled by the process of creation. In order to end economic
inefficiencies, we should model our economic practice on the process that
preceded production and has led to its emergence. In addition, the study will
outline ways in which our economic theory and practice must be changed to
achieve full efficiency of our production. Finally, the study provides a
critical overview of the current theories of inflation and remedies that are
proposed to deal with it.
