Inflation

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Inflation is the fractional-reserve banking driven increase in the supply of money over time, which often results in a general price rise.

In layman's terms, this means that landlords and grocery stores want more money, so tenants and fuel companies want more money, so workers want more money, so banks and lenders want more money, so executives want more money, so healthcare companies want more money, so the government wants more money, so the manufacturers and large businesses want more money, so office space landlords want more money, so large businesses outsource workers so they don't have to pay local taxes or local office space, so the tech companies and importers want more money, and local services and drivers want more money to make up for the lack of people working locally, so business leasing companies want more money, so residential housing landlords want more money, so everyone goes broke. And they say Greed is good. Well, I say it is good as long as I am the only one who benefits. Besides, how else did that guy get the presidency?

It is widely regarded as both good (by speculators) and evil (by Bears). The rate of inflation from region to region varies depending on the level of government mismanagement of the economy. For example in the U.S.A, a highly regulated economy, a price rise rarely occurs. On the other hand, in Zimbabwe or United Kingdom (slightly troubled countries), the price of a quart of dirt or a bottle of water has risen 231,000,000% since you began reading this sentence. No wait, now it's 567,000,000%.

Inflation. It's not my fault.

Measurement of inflation

Inflation is most often expressed as a percentage of change in consumer prices since the last time someone looked at the graphs. This period commonly corresponds to one of your "Earth" years, which has leant credence to the popular theory that inflation is actually measured by magnified sunlight burning holes in tanned parchment at Stonehenge on the winter equinox. Concerned that inflation was being increasingly manipulated by Druids, the United Nations in 2014 banned the use of ancient ruins for economic speculation.

Inflation often rises during times of war. This is an effect of rationing, a system for distribution of goods by which the community has less of everything than they did before. Government price-fixing can help counteract this inflation, but can also lead to the maintenance of conflicts. The most famous example of this was the press conference following the royal decree of Richard II fixing the price of wagon wheels during the Hundred Years War. In response to an intrepid reporter asking how long the prices would remain fixed, Richard said "Let's see... a hundred years. Why not?" This was said by historians to strengthen the French resolve (for once).

Several pieces of paper that can be exchanged for goods and services. What were they called again.... Oh yeah I remember now, Tofu!

Theories of inflation

A number of competing theories exist for why inflation occurs. Inflation can be observed in feudal China in the ancient proverb, "A goat is a goat, but will still look rationally into the future when trying to maximize its well-being." John Maynard Keynes was famous for advocating limited government intervention in order to stimulate economic growth, called the "Keynesian" or "It Wasn't Me" Theory. He derived this theory by observing overfeeding of his cocker spaniel Charlie with chicken wire and old boots (or "interest rates"), to encourage exceptional bloating (or "farts").

See also

• Economics
• Currency
• The Bank
• Deflation - happens only when government manages the economy excellently
• Hyperinflation - an extremely high inflation by government mismanagement and/or over-investment