Inflation tends to be thought of as the "increase in prices." When prices go up, we say there is inflation, and we wonder what could be done to combat this phenomenon. However, inflation is more correctly defined as the increase in the money supply. When extra dollars are ordered by a central bank and printed with no tangible assets backing the value, the central banks use this newfound, almost counterfeit money to purchase bonds from private banks, therefore giving extra cash to the banks which are low on reserves. This results in artificially low interest rates. The extra cash is then lent out by banks to their customers, thereby increasing the money supply. But if a commodity is less scarce, its value correspondingly decreases. The price of an ounce of dirt is worth less than the cost to pick the dirt up off the ground, because dirt is everywhere. Precious metals, on the other hand, have an intrinsic value not only because of their use in certain technological applications, but also because they are so scarcely distributed within the crust of the earth.
Thus, as the money supply increases, the value of each unit of currency decreases. This effect is not always uniformly distributed across an economy and time, but it is real and present nonetheless. As a result, prices must go up, because everybody in the economy has more money to spend, but productivity remains the same. Increases in prices must be thought of as increases in the money supply, and the only way to deal with increases in prices is to curb the excessive, artificial acceleration of the magnitude of the money supply by central banks which are not audited by the legislative bodies of those countries for which they operate.