Talk:Inflation rate
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Can someone add a table of the inflation rates for the United States and some of the other industrialized nations such as Japan, any of the European nations.
Some numerical data is truly essential and they are lacking hereon.
--John on 5 October 2005
I would also like to see the top 20 countries ranked by inflation rate worldwide. Ari on October 22, 2005
Who is the decider of 'Inflation Rates'? Would like to understand if it is from within the country of origin, or decided by foreign countries and banks? Mick
Umm...Mick, that is a VERY perturbing question you just asked. Inflation is virtually a natural process. As people work, and earn more, they stary buying more. Prices increase to meet their demandd...increases in priced is inflation. To answer your question though, over the years it has been learned (from the great depression of the 1930's and crisis of the 1970's) that inflation must be controlled, and that monetary policy can cause even more inflation. As was the case in Argentina.
Goverments creating more money means a decrease in the value of their money which means an increase in prices. And like I said, an increase in prices means inflation. So governments have now become aware of that since the end of the fixed exchange systems of the 1970's and use control of the money supply to control inflation: decreasing the currency supply to decrease inflation, or increasing currency in the market to increase inflation. So to answer your question...right now, the Federal Reserve System controls the rate of inflation in the USA. Or to put it correctly, Central Banks react to inflation. If they see inflation on the rise, they decrease the money supply. Inflation is always there. But the Central Banks of the world and the Federal Reserve System of the USA, can increase inflation, or decrease it. Most times they will do this, because this helps them maintain control of the economy's growth.
I hope this explanation is satisfactory and simple enough to understand, 4 years of getting my economics BA, and this is the best knowledge I can impart. ^_^ Maybe someone would like to add what i just said, to the article--since it easily explains the relationship between inflation, the economy and the money supply. --Persianlor
