Pandemic, Payments, And Price Increases

Photo by Viacheslav Bublyk on Unsplash
Chart 1: Monthly Outlays of US Government. Source: May 2020 Report of Bureau of Fiscal Service

Should we worry about prices increasing fast?

Printing money is associated with a consequent increase in prices of goods and services. In economics, this is referred to as inflation. A simple way to think about it is, the more money there is circulating in the economy, the more people and firms tend to buy, increasing overall demand, which then tends to result in increases in prices. With the speed at which central banks are printing money, it is natural for economists to think inflation might be worrisome. Some however, argue that this worry may not be as big as it may seem.

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Valerie Dela Cruz

Valerie Dela Cruz

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Mathematics, books, and writing | With a penchant for self-reflection | Born and raised in the Philippines, lived in New Zealand, based in London