Unexplainable We still don’t really know how inflation works
34 snips
Jun 26, 2024 Delving into the mystery of inflation surge, the podcast explores factors behind the unexpected rise impacting voters. It discusses central banks shaping public beliefs on economy stability and the challenges they face. The chapter also questions the extent of people's impact on inflation expectations post-pandemic.
AI Snips
Chapters
Transcript
Episode notes
Dylan's Inflation Prediction
- In summer 2021, Dylan Matthews, while reporting for Vox, noticed rising concerns about inflation.
- Despite his initial skepticism, he published an article titled "Don't Worry About Inflation," which proved inaccurate.
Inflation's Unpredictability
- Inflation surged to levels unseen in decades, prompting Dylan to write a follow-up article admitting his misjudgment.
- Surprisingly, inflation began to decrease a few months later, confusing economists about the cause.
Inflation-Unemployment Seesaw
- One theory suggests inflation arises from excessive spending, creating a seesaw effect with unemployment.
- Increased employment leads to higher spending and inflation, while higher unemployment lowers spending and inflation.