Monday, January 21, 2013

Why Is There No Inflation?

The short answer to this is that … macroeconomists aren’t really sure.

Clearly, the Federal Reserve has been trying to pursue expansionary monetary policy for a few years. That should lead to inflation. It really hasn’t. Why is that so? David Wessel’s “Capital” column goes over 3 reasons you should be aware of.

Also, we’ll be discussing inflation this week, and you need to be aware of the pattern in this chart from that article:


Read the whole thing, entitled “Will Fed's 'Easy Money' Push Up Prices?” in the January 17 issue of The Wall Street Journal.

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