Inflation spurs investment because investors look to various assets like equities, commodities and real estate. Inflation also spurs spending, because the knwledge that cash to morrow will be worth less than cash to day is a motivator to spend now. So it's healthy for a society to have a small, controlled degree of inflation. India has set its target inflation rate at four %, with a plus minus two % on either end.
#365: Nearly every financial news story for the past several months has centered around inflation – but what, exactly, is inflation? What are its causes? What are its effects? How is it measured? What notable inflationary events have unfolded throughout history, and what can we learn from these?
In this episode, we peel back the layers of the onion in order to deepen our understanding of the concept of inflation. We discuss hyperinflation, biflation, stagflation; we discuss the CPI, the PPI, and core inflation. We discuss the demand-pull inflation, cost-push inflation and the wage-price spiral. We resist the temptation to make predictions about the future, choosing instead to focus on refining our understanding of the present.
Enjoy!
For more information, visit the show notes at https://affordanything.com/episode365
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