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The Higher Price of Economic Growth

For now, it appears that the U.S. is experiencing growing pains as the economy strengthens. Indeed, the days of deflation and free money are over. But the latest data signals that the period of anemic growth in the labor market is ending. By far, that's a better-than-fair trade.

Ok, let's review.

(1) Inflation results when money growth outstrips money demand.

(2) All else equal, economic growth stimulates money demand.

(3) For a given path of money growth, then, higher growth should mitigate, not exacerbate, price pressures.

Is a teacher's work never done?  Oh, well. At least Rueters and the Chicago Trib wouldn't make this mistake.