I have been in the habit lately of using my credit card for my gas since I get 5% cash back on my gas purchases. I pay it off every month but I was wondering if this was a distortion of the money supply because I have the $400 in my bank, $400 on the credit card and the people who sell me gas have $400. Instead of me having $0 in gas money reserves at the end of the month and the gas seller having $400.
I'm not trying to argue about whether I should use a credit card or not in general. I was just wondering if the $20 benefit I get every month is causing inflation no matter how small it is.
Does it matter if the card is with a bank such as a Bank of America Visa versus a non-bank Visa. Is the card with BOA expanding the money supply because they are not loaning me money they have on deposit but getting it from the FED to loan me. Does a non-bank Visa have the power to do the same or do they have to loan me money they have (and not get the FED to print them money).
I'm wondering if I should keep earning my $20 or switch to using my debit card or Federal Reserve Notes in order to not inflate the currency.