4 ms·

It’s only accurate if 7% inflation also persists for 10 years, which seems unlikely.

• jmarbach 5y ago
  High inflation persisted in America in the 1970s. Why wouldn’t it happen again?
  • anotherman554 5y ago
    Because we have different Federal Reserve policy than we did in the 1970s, for one thing.
    • thallium205 5y ago
      The fed in the 70s slowed inflation by raising interest rates to 20%. The current fed will never do that.
      • sfe22 5y ago
        Correct. And there is a reason, at 10% interest rate, the federal government is bankrupt.
  • vkou 5y ago
    It could happen again, but equity returns wouldn't be sub-inflation for 10 years, because the real economy isn't shrinking by 4% a year.