The Cantillon Effect is what happens when extra money is created (like a government or bank printing more).
The new money does not reach everyone at the same time. People who get it first (banks, governments, or big companies) can spend it while prices are still low immediately. They buy things cheap.
Later, prices go up for everyone. People who get the extra money last — or never get any — have to pay more with the same old money.
After the 2008 financial crisis, and again in 2020, central banks created huge amounts of new money. This money went first to banks and people who already owned stocks and houses. Those prices rose quickly, so those owners became richer.
A few years later, prices of food, rent or house prices, and everyday things also went up. Families who only had regular jobs and savings found that their money bought less.
So it helps some people and hurts others, even if nobody meant it to be unfair.
Think of it like this: the people closest to the new money win first, and the rest of the country pays later.
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1August 21, 2026 2.6K 75
