shouldn't be too difficult.
'We are experiencing this sudden surge in inflation for two main reasons,” says Craig Kirsner, President of Stuart Estate Planning Wealth Advisors in Coconut Creek, Florida. “First, for the past year and a half due to Covid hardly anyone was spending money. Now that the economy is back open, people are spending and traveling and, as such, there is a bottleneck with very high demand. Our system isn’t set up for this high demand level, so that causes inflation in the short term. Second, with interest rates lowered to almost zero since March of 2020, these low interest rates have spurred demand in housing which is experiencing a large backlog as well as adding to inflation worries.”
https://www.forbes.com/sites/chriscarosa/2021/08/23/covid-or-policy-whats-causing-this-inflation-surge/?sh=54ac59524c0f
So the rise in inflation is a short-term effect of the end of the pandemic?
That is absolutely the overriding factor. Consumer demand is outpacing the supply of goods and services. Everyone knew inflation was going to be high; the only question was how high.
https://www.rochester.edu/newscenter/what-is-inflation-is-there-economic-crisis-485642/
Based on this body of work and the facts in this paper, we draw the following conclusions at this point in the economic recovery. First, the initial rapid economic recovery and expected slowing creates risks that policymakers should heed. Second, fiscal support has been essential to accelerating the recovery. Third, greater federal investment in infrastructure, both physical and human, is key to improving the country’s longer-term economic prospects.
https://www.brookings.edu/research/11-facts-on-the-economic-recovery-from-the-covid-19-pandemic/
((LOOKING for discussion of disrupted SUPPLY CHAIN, but it's late and haven't spotted it.))
Why supply chain chaos and inflation could last into 2022.
Federal Reserve chair Jerome Powell said on Friday that Americans should be prepared for the global supply chain to remain in crisis through 2022 — and that the central bank is preparing to deal with the attendant challenges for the US economy.
Speaking at a Bank for International Settlements-South African Reserve Bank centenary conference, Powell warned that “supply-side constraints have gotten worse” over the course of the pandemic, while the supply chain and economic risks are “clearly now to longer and more-persistent bottlenecks, and thus to higher inflation.”
Already, those bottlenecks have slowed international commerce to a crawl as shipping containers loaded with goods wait to be unloaded and experts advise making an early start on holiday shopping.
In addition to packages taking longer to show up, consumers are likely also feeling the resulting inflation: The Consumer Price Index, a measure of the increase in the price of goods over a specific period, rose more than 5 percent in the 12 months ending in September, as Vox’s German Lopez explained.
https://www.vox.com/2021/10/24/22743104/supply-chain-inflation-shortages-2022
= new reply since forum marked as read
