Briefing: Inflation is essentially the increase in prices of goods and the devalue of the dollar.
The graph above displays the rate of inflation from 1960-2022
The strongest inflation standpoint in history was in the 1980s, when monetary policies weren't fully reconfigured. This set a drawback for nearly a decade in lower interest rates, and drove up the value of US currency.
During the 1960s, there was an ongoing war being held in Vietnam. The war had originally began, in fact, because of a "dispute between two colonies" which incited a need for military investment from the government (Bartleby). Whenever a nation involves themselves in a war, they are initially agreeing to invest money they don't have into the war effort; that's exactly what happened. As the current president of that time, Lyndon B. Johnson decided to start a service deemed "The Great Society" in order to sustain the public goods and invest into the war effort, but it backfired on them. Within 4 years, the rate of inflation from 1966 to 1970 increased by 6.5% and left the United States in a state of restoration to accommodate for inflation and rising interest rates. During the next decade, the United States would be governed by poor monetary policies, and inflation was never truly resolved but rather procrastinated in order to balance out prices across different businesses.
The state of inflation continued to increase during the 1970's, getting worse each year. It was during these times that the government struggled to deliver efficient solutions to previous monetary policies, so the problem with inflation remained unresolved. Once the 1980's approached, inflation had increased to a whopping 13.6% and this impacted the value of the dollar bill significantly. Fed chairman Volcker had since then created many organizations and programs to tackle the inflation problem, primarily focusing on the rise in interest rates to accommodate for inflation. The extra interest would be used to drawback the inflation level and slowly balance out the dollar's value again.
Fed Chairman Volcker's Efforts!
This video accurately explains what struggles Fed chairman Volcker had to go through in order to lower the inflation rates, including the services that were created, and the alternation of monetary policy in respect to trial and error.
What Inflation is Like Today ----------------------------------------------------------------------------------------------------------------------------- Inflation Today vs. in the Past: Currently, inflation is one of the biggest problems America is facing. By the end of 2021, the inflation rate had risen to seven percent. This is considered a very bad sign for America, considering the fact that most countries' rates rest between 1.5% and 4% . Inflation hasn't even reached five percent in the United States since 1990 and it hasn't reached the rate it is at today since the early 1980s. A ccording to Statista Research Department , the rate of inflation was at an all-time high of 13.29% in the 80s. Although there have been progressive setbacks in the early 2000s, inflation has gone up tremendously in just these past two years and it continues to rise as we're finishing up 2022 going into 2023. We all have been able to notice the ra...
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