Posted on 04/15/2013 6:41:57 AM PDT by Sub-Driver
-——what is holding inflation at the pace it is at?-——
One large factor in the inflation equation is wages. Wages are being held down by unemployment. In strong demand, wages reflect the supply and can rise. When there is an excess of workers, the cost can be stable.
There are two administration efforts to raise wages.Raise the minimum wage and increase the wages on union contracts.
What is keeping inflation from hitting the US is the weakness in the European and Asian economies. Right now the American dollar remains the world’s leading currency, because so many other currencies are weak. The situation is like a volcano. The pressure continues to build, but the top hasn’t yet blown off. When it hits, it will be sudden and massive. I am old enough to remember how quickly inflation spiralled in the early 70s.
Isn’t it that the velocity of money is at a near stagnation rate
that is keeping inflation down?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.