How we got to the highest inflation in 40 years

The video explores the causes and mechanisms of inflation, comparing the 1980s to the present. It explains demand pull and cost push inflation, highlighting current factors like supply shortages, worker demands, federal aid, and low interest rates. The impact of global events, such as the Ukraine war, on inflation is also discussed.

What were some of the factors that contributed to inflation in the early 1980s?

• Increased agricultural production

• Decreased consumer demand

• High technology advancements

• Excess spending during the Vietnam War and oil shocks

How does demand-pull inflation occur?

• When government reduces taxes

• When consumers demand more, driving prices up

• When production costs decrease

• When supply exceeds demand

What is one of the main causes of current inflation related to the workforce?

• Reduction in working hours

• Decrease in technology use

• Increase in remote work

• Workers demanding higher wages

What effect did historically low interest rates have on the housing market?

• Increased housing demand

• Decreased housing demand

• Stabilized housing prices

• Increased housing supply

How did Russia's invasion of Ukraine contribute to inflation?

• By increasing global peace

• By stabilizing energy prices

• By disrupting the supply of food and energy commodities

• By reducing global trade barriers