Eli5: Why can’t prices stay the same/inflation be 0%?
In: Economics
It should be noted that- even if the money supply stays the same- prices will still change, because the supply and demand for goods and resources is always changing. Housing prices will go up if there are more people looking for houses and we’re not building enough new houses to keep up. Oil prices will go up and down based on seasonal demand, new oil reserves being found, and competing fuels/energy increasing.
It’s important to realize that all prices are the result of a long-term bidding process in the market, and there’s no objective basis that any of them are set by.
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