1970s: Stagflation

Let’s rewind to 1965 in the UK, how the term “stagflation” was coined, and the global spread.

In the 1970s, the world economy was slow, but inflation rates were high

In describing this problem, a British politician combined the word "stagnant" with "inflation" and coined the term: “stagflation”

In the 1970s, stagflation spread globally and landed especially hard in the US 🇺🇸

Consumers lost interest in foreign goods and business owners had trouble restocking right after a strong holiday season

Economists had previously assumed that inflation could be high when the market was strong and unemployment was low 🤔

Stagflation resulted in a dilemma because efforts to reduce inflation could increase unemployment and further slow economic growth, while efforts to increase economic growth could increase inflation!

Ultimately, stagflation only ended after a painful recession and tighter controls over spending by the government 💰

Test your knowledge

Stagflation is. . .

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Stagflation is difficult to solve because. . .

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Which of the following did not contribute to stagflation?

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What's next?

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1987: Black Monday Crash

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2000: Dotcom Bubble Burst

Let’s talk about the Bubble burst that marked the beginning of the 2000s that took 15 years to heal from.

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2008: Financial Crisis

Let’s talk about the next crash that triggered the Great Recession as the worst crisis in 8 decades.

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