ShmoopTube
Where Monty Python meets your 10th grade teacher.
Search Thousands of Shmoop Videos
Metrics Videos 354 videos
What is a thin market, and has it been on Jenny Craig recently?
What are moving averages? Moving averages are calculated using past stock prices in an attempt to determine future trends. It’s calculated by ave...
What is Above Full Employment Equilibrium? Above Full Employment Equilibrium happens when an economy is basically doing more than it realistically...
Finance: What is Disinflation? 5 Views
Share It!
Description:
What is Disinflation? Disinflation is a term used for an interim slowdown of inflation rate. For example, a reduction of inflation growth from 3.5% to 3.1% would be a slowdown of inflation, although prices would still be rising. This would be characteristic of disinflation.
- Social Studies / Finance
- Finance / Financial Responsibility
- Life Skills / Personal Finance
- Finance / Finance Definitions
- Life Skills / Finance Definitions
- Finance / Personal Finance
- Courses / Finance Concepts
- Subjects / Finance and Economics
- Finance and Economics / Terms and Concepts
- Terms and Concepts / Econ
- Terms and Concepts / Metrics
- Terms and Concepts / Mortgage
- Terms and Concepts / Real Estate
- Terms and Concepts / Regulations
- College and Career / Personal Finance
Transcript
- 00:00
finance a la shmoop what is disinflation disinflation often confused with dat
- 00:09
inflation refers to the decline in inflation rates over time in 1973
- 00:15
America was fully juiced with Warbucks from Vietnam inflation hovered around [soldiers firing weapons]
- 00:20
the mid going on high single digits and then higher from there like 7% or more
- 00:25
depending on where you look him and Jimmy Carter stepped in on this guy and [Carter walks into office]
Full Transcript
- 00:28
raised the federal rates the Fed rates their massively stamping out the wild
- 00:34
bull economy and putting the brakes on inflation but it didn't happen until
- 00:37
after Carter was actually out of office and Reagan took over inflation [Reagan replaces Carter in office]
- 00:42
eventually had rocketed all the way up to about 14 ish percent on an annualized
- 00:47
basis looking at the monthlies in the 1980-81 period right here
- 00:51
well the crux of dis inflation is that inflation is still positive it's just
- 00:56
becoming well less positive and or like you know how you feel not long after you
- 01:01
say I do and the honeymoon is over and you have to take out the garbage so
- 01:04
under Carter the US inflation rates were attacked in a variety of ways the [Carter in a boxing ring]
- 01:08
biggest of which was to make the cost of renting capital very expensive which
- 01:12
cooled the economy but it took a long time like note how slowly inflation
- 01:17
rates came down and well really it was decades before things fully stabilized
- 01:21
you can see how things slowly disinflation the raging levels that
- 01:25
peaked at post-vietnam era 1314 percent then slid all the way down to a 1 to 3
- 01:31
percent way down there where it's hovered for a
- 01:34
while so that's disinflation still inflation but just less of it deflation [Disinflation deflating]
- 01:40
is when inflation turns negative like prices are actually declining and yes
- 01:45
we've had periods of deflation before albeit very short ones like in the post
- 01:49
mortgage crisis Mallove's in 2009 right here yes yes it's rare but it happens
- 01:54
got it okay class dismissed
Related Videos
GED Social Studies 1.1 Civics and Government
What is bankruptcy? Deadbeats who can't pay their bills declare bankruptcy. Either they borrowed too much money, or the business fell apart. They t...
What's a dividend? At will, the board of directors can pay a dividend on common stock. Usually, that payout is some percentage less than 100 of ear...
How are risk and reward related? Take more risk, expect more reward. A lottery ticket might be worth a billion dollars, but if the odds are one in...