So everyone is talking about this year’s US inflation, can anyone explain why it’s so important?
In: Economics
We’ve escaped inflation in the past by increasing production faster than the money supply.
During covid the opposite happened.
Production slowed when people were kept home from work, while the government injected massive money (covid relief) into the economy.
The government replaced the lost wages, but not the trillions in goods, and services that would have been produced.
Supply vs demand is what drives prices up.
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