As prices of goods and services increase this year, so does the fear that the economy may be entering an inflationary cycle: Prices rise when demand exceeds supply and can occur when too many dollars chase after too few goods and services. While “deficit hawks"(opponents of increased government spending) blame the various stimulus programs enacted to keep the economy from complete collapse during the pandemic by injecting too much liquidity into the economy, the steward of the nation’s monetary policy, the Federal Reserve, has decided increased prices are due to “transitory factors” such as pent-up demand and the time needed for businesses to resume full operations.
Given the Fed’s projection of rapid economic growth for the remainder of this year and a receding in the inflation rate in 2022, do you have a positive or negative view of the nation’s economic future?
Do Rising Prices Mean Inflation?
As prices of goods and services increase this year, so does the fear that the economy may be entering an inflationary cycle: Prices rise when demand exceeds supply and can occur when too many dollars chase after too few goods and services. While “deficit hawks"(opponents of increased government spending) blame the various stimulus programs enacted to keep the economy from complete collapse during the pandemic by injecting too much liquidity into the economy, the steward of the nation’s monetary policy, the Federal Reserve, has decided increased prices are due to “transitory factors” such as pent-up demand and the time needed for businesses to resume full operations.
Given the Fed’s projection of rapid economic growth for the remainder of this year and a receding in the inflation rate in 2022, do you have a positive or negative view of the nation’s economic future?