4 ms·

Inflation is not a natural disaster, and pandemics do not imply inflation either. You can debate various ways to account for the inflation, but you do have to a

• bruce511 5y ago
  Exactly right. And usually there are multiple causes, some are temporary, some are permanent. For example there are currently chip shortages. Supply and demand says that when there are shortages prices go up. Chips are in everything, so the knock on effect is huge. Which in turn drives up prices, but also results in some other shortages (like cars) which in turn has ripple effects. It's possible, perhaps even probable, that these shortages are short-term, and prices will stabilise, meaning that they'll find a new "fixed" level. Corrections in supply may lead to over-supply and prices coming down, or demand may drop and prices come down. There was a shortage of lumber, coupled with high demand, during the first year of the pandemic due to low staffing at Mills, combined with people at home with time on their hands. Back to work means not just supply being restored, but lower demand, and prices have fallen (although not necessarily to pre-pandemic levels.) These are just two examples, with very different supply/demand curves. Literally everything will have its own curve. Pandemics do not imply inflation, but a massive stay-at-home is going to affect supply, at every possible level (production, distribution, retail) so inflation is certainly likely. In sectors where demand increases from people staying at home the effect is more pronounced.
  • missedthecue 5y ago
    Your narrative is several months out of date. Lumber is back near all time highs.
    • s1artibartfast 5y ago
      Demand is still high.