By: Hawzheen Nawzad
6 Things you should know about Inflation?
THE CAUSE OF INFLATION- Inflation is caused by demand pull & cost push. Demand pull is caused by the economic growth when the government cuts interest rates and taxes making housing prices go up 30% this rises the consumers confidence of having a good wealth. As of cost push When wages increase goods from outside the US began to rise such as oil and other natural resources become more expensive.
INFLATION RATES- Inflation rates are caused when a lot of people fight over fewer goods. Such as eBay if someone placed a iphone for sale for $100 a lot of people would place bids on it and the price will rise. That is how inflation rates are caused.
IMPACT OF INFLATION- Inflation impacts everything in our live because when something in prices increases the other decreases. such as of supply increases demand decreases but if supply decreases then demand increases. This impacts our society from the things we want and need. This is how inflation has an impact.
FEARS OF INFLATION- The fear is inflation has been increasing at a rate never seen before. Unemployment rates are higher than ever, quickening job growth and consumer prices are rising at a rate that hasn't been seen in months which is making it a fear of when inflation is gonna hit the US and have a huge impact on us.
FACTS OF INFLATION- Some interesting facts for inflation is that fed and the government like inflation because they benefit from it and since 2006 inflation has been heating up but this is a big help for the feds. Bankers are suppose to keep the inflation rate as close as to zero before its late so feds and bankers have have kept the interest rates closet to zero til 2015.
DANGER OF INFLATION- If inflation is to low then the federal reserve will be making easy money so when the government needs more money they collect it from tax making taxes prices increase. Making wages cut down and workers get paid less.