How can inflation be so high right now when average incomes have stagnated for so long? People don’t have more money to spend. Why is inflation so high?
In: Economics
It’s a short term blip, caused by dramatic drops in prices a year ago on many goods due to COVID, and shortages of things like computer chips and lumber now that have led to higher prices on appliances, cars, new construction homes, furniture.
Also, people do have money from stimulus, enhanced unemployment, etc. and there is pent up demand from doing nothing for a year. The money not spent commuting or vacations or going to restaurants is now getting spent.
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