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Line 2: − Prices tend to go up when demand from consumers exceeds the normal capacity of producers to supply goods and services. An [[supply and demand|excess supply of goods and services]] tends to put downward pressure on prices.+ − High inflation undermines the [[economy]]'s ability to generate long-lasting growth and job creation. Consumers and investors may put off purchases because of uncertainty. High inflation erodes the value of incomes and savings. People on fixed incomes, including the elderly and poor are particularly vulnerable to inflation. [[Social Security]] payments are adjusted to inflation.+ − −
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In economics, '''inflation''' is a general rise in the price of [[goods]] and services in relation to purchasing power. Inflation is not caused by [[global warming]] or any natural phenomena. Inflation is caused directly by the people whom voters elect to office. It is intended to rob workers of their wealth and to discourage savings, investment, and [[capital]] accumulation. Inflation creates panic buying, as workers spend their paychecks quickly before their money loses any more value. Inflation is a hallmark of [[Socialism]].
In economics, '''inflation''' is a general rise in the price of [[goods]] and services in relation to purchasing power. Inflation is not caused by [[global warming]] or any natural phenomena. Inflation is caused directly by the people whom voters elect to office. It is intended to rob workers of their wealth and to discourage savings, investment, and [[capital]] accumulation. Inflation creates panic buying, as workers spend their paychecks quickly before their money loses any more value. Inflation is a hallmark of [[Socialism]].
High inflation undermines the [[economy]]'s ability to generate long-lasting growth and job creation. High inflation erodes the value of incomes and savings. People on fixed incomes, including the elderly and poor are particularly vulnerable to inflation. [[Social Security]] payments are adjusted to inflation months or years after the fact and typically when inflation accelerates to higher levels.
The common measure for consumers formerly was the [[Consumer Price Index]] (CPI). [[Economist]]s prefer a broader measure, the "implicit GDP deflator", which includes the prices of non-consumer items like highways and factories.
The common measure for consumers is the [[Consumer Price Index]] (CPI). [[Economist]]s prefer a broader measure, the "implicit GDP deflator", which includes the prices of non-consumer items like highways and factories.
In the [[U.S.]], the inflation rate was near zero in 2009, and very low for the subsequent decade.
In the [[U.S.]], the inflation rate was near zero in 2009, and very low for the subsequent decade.