What is Inflation? 

Stashed away cash for a rainy day, but with inflation pouring down, it feels more like a leaky bucket. Saving for retirement seems impossible if my money keeps losing value faster than I can earn it.

The system is failing as a result of both government and federal policy. In the next days, the banking crisis would have to be epic and gigantic for the FED to decide not to raise interest rates. This won't happen; an increase and a crash are coming. There will be more negative portfolios this 2nd half of 2024 with markets tumbling, soaring inflation, and banks going out of business. My concern is how can the rapid interest-rate hike be of favor to a value investor, or is it better avoiding stocks for a while?

Inflation is treated like a technical term for economics... but it's a naturally occurring event in everything we do. ....Like when a friend asks you a favor and you do it gladly, but then your friend starts assuming you never have anything better to do and asks too many favors, so you have to VALUE your time more, and saying "no" every now and then. ...Or like people that compliment everything too much, even if it's not compliment-worthy, that person's compliments start losing value, aka deflation. Inflation exist because it's part of nature, not a part of money. Economics are not money concepts, they're life concepts. Money is nothing but a universal intermediary, a tool that unites disciplines.

In Venezuela people be like: *Im finally a billionaire, now i can buy an egg* A cold war is going on below.

Well in 8 minutes you covered what my high school economics teacher couldn't do in 2 years. He preferred to tell us of how well his investment properties were doing, bless him.

Inflation is far more harmful to individuals than a collapsing stock or property market because it directly affects people's cost of living, which they immediately feel. It is not surprising that the current market sentiment is extremely pessimistic. In today's economy, assistance is critical if we are to survive.

The way I see it this recession most likely has an external cause. The United States is losing influence as a federal currency for the first time in decades. They don't have any more economies to utilize to control their inflation, and less money is being spent on stock and oil trading than previously. They all lend credence to the hypothesis that a new multilateral world order may be in the works.

That feeling when you're not sure if it's School of Life or Kurzgesagt videos you've tuned in to.

Thanks! Now I'm even more scared of the future.

8 minutes and I'm immediately prompted to invest in property or gold instead of simply holding onto cash.

A powerful coincidence is preparing in the US. Expansion, bank breakdown, serious dry season in the horticultural belt, downturn, real estate market decline, bank emergency, food deficiencies, diesel fuel and warming oil deficiencies, child recipe deficiencies, accessible car deficiencies and costs, the cost of residing place. It's all approaching together and it could prompt a genuine calamity towards the finish of this current year (or sooner). With expansion at present at around 6%, my essential concern is the way to expand my reserve funds/retirement asset of about $300k which has been exposed target since perpetually with zero to no increases.

1:31 Cost-push inflation (where the costs of businesses rise, and businesses then raise their prices) Cost of business could rise because materials are more expensive, because workers are asking for more money, or because rent is higher 2:22 Demand inflation (when too many people want something that there's not enough of) This increase in demand can be caused by people now having more money to spend (whether it be through better saving, earning, or stimulus checks ;-) 3:33 Governments printing money (and the amount of money in circulation increases, causing the worth of money to drop) 6:23 Inflation is bad for savings (causes savings to be worth less) 6:37 Keeping inflation low is a reward to the prudent (people who saved) and helps with long-term planning because we'd know what our money will be worth in the future

“learning to live with inflation belongs to wisdom” lol say that to venezuelans and their 1.000.000% inflation growth per month

I've never heard of any billionaire or millionaire who got rich accidentally it's all premeditated. This brings me to why investing holds the most power when it comes to real wealth. What you do today determines your future financial status, I'm glad I started investing with Finance Fluent a long time ago and have made a way for myself and family.

>Inflation is killing my budget and my salary. I can't invest and it seems like I will need to sell all of my risk assets to keep my head above the water this year. What is the best solution right now? These are really though times.

Given the high inflation, the use of coupons is more widespread than ever and many people rely on them not only for the purchase of food but also for clothing and much more. The transition to the 8112 digital coupon format is imminent. Qples by Fobi is the only platform able to provide physical/digital coupons anywhere in the world redeemable in real time! This is very valuable for the big CPG brands as they allow them to improve their Roi but above all customer loyalty, which has proven to change brands if the situation is advantageous. McDonalds, burger King and many other brands could use Qples by fobi coupons to increase customer loyalty, Roi and improve their margins. Given the high inflation that has led to the reduction in consumer purchasing power, CPGs are looking for new ways to attract customers. I think the arrival of digital coupons and the transition to 8112 has been accelerated by all of this. The decline in margins and profits that we are witnessing of many tech companies, once considered leaders, confirm the shift of the consumer in search of better opportunities and bargains offered by coupons.

We read news in the media that doom and gloom is coming and we just accept it, doom and gloom doesn’t always have to be coming, I’ve read numerous success stories of people that are pulling off tremendous gains of up to $250K within weeks in this crazy market and I just want to learn how to achieve such figures.

How can a video on Inflation be sooooo soothing??? 🤔😊🤔 Clearly and simply explained- thank you!

This is helpful, now I would really love a whole series on economics. I can get my head around philosophy and politics with relative ease but most financial ideas elude me. I mean, what even is currency?? (that sounds kind of philosophical now that I think about it)

Because production steadily becomes more efficient, products become cheaper. The undisturbed monetary status is deflation. This is a good thing because we all slowly get richer. There is no need to invest your money in the financial markets (with all the risks involved) in order to protect yourself against inflation or to save for your pension. Inflation is always the consequence of some form of interference, usually by governments; be it by importing huge amounts of gold and silver from South America as the Spanish did, or be it through economic policy as we currently have. If the amount of money in circulation is constant then the generic price level can only rise when less goods are around that need to be priced, meaning when the economy falls. When the economy stays flat, some prices can rise (due to shortages) but others must fall. It is not possible to grow an economy by increasing the amount of money in circulation. If that were possible we would all be very rich and poverty would no longer exist. What happens in the mentioned 'window of opportunity' is that new money is spread unevenly through society. Those who receive it first, banks and governments, can profit of the full purchasing power of it. Those who receive it last, people on fixed income like pensioners or welfare receivers, are the losers of this great redistribution scheme. It's an injustice. And, as already has been stated, most money is created in the form of credit through fractional reserve banking. This is also the cause of the so called boom-bust cycle or credit cycle as all the credit created has to go somewhere, real estate, government bonds or Internet shares. After a while the bubble inevitably has to burst; the loans cannot be paid back, companies go bankrupt, banks get in trouble and the total amount of money and credit in circulation drops. This is what we call an economic crisis. It is man made and the consequence of the effort to manage the economy.

Even if a non dollar-denominated asset sees no real gains during inflation that's still much better than holding cash and seeing your real purchasing power undermined. In other words, sometimes you have to chose between the lesser of two evils.

Wow.. A six hour lecture covered by less than 8 minutes. Clear and everything is on to the point.

That 'going wrong->growing->falling->failing' animation at 7:00 was beautiful!

Great video! So relevant for 2022, interest rates and inflation are going to be HUGE themes

There is no dark corner for doubt or ignorance to gnaw at us, so long as The School of Life bestows it's many lessons to us in clear and comforting ways.

Love this! If you could do videos on stock markets, how they determine interest rates and currency exchange rates that would be great. I never understand it and most people I ask dont either. Like why can you get a better exchange rate at one place in comparison to going to another. How does the economy even work!? These are things that, if you didnt take economics in school, you may never really know.

Have taken so many sophisticated economy courses but they rarely could explain inflation and its causes as elaborate as this!

Only after the video ended I noticed the channel it was from...and throughout the video I wondered how come an economist have such a soothing and peaceful philosopher like voice.

That explains how the us government handed out 4 trillion dollars to it's citizens during the pandemic and now a used car that would normally cost $10,000 is almost double in price. And don't get me started on the cost of buying a house.

Wow, this is such a helpful video! I think it's a really great balance between specifics/big picture information. Thank you and I look forward to watching the rest of your channel now...

I really appreciate how some issues you've discussed in the past (such as building permits in the "beautiful city" video) are coming up again.

Beautifully done, I appreciate and will pass as a subject to my kid. RK

I liked that last line. "Learning to live with inflation belongs to wisdom"

I know this is meant to be a quick video, but I would have thought that a mention of fractional reserve banking would be in order here, since it is the basis for how banks create money. Linked to this is the concept that essentially all money comes into existence through bank loans, which means someone somewhere has to pay interest on every dollar/pound/euro/etc in circulation. The only way that is paid is for someone else to take out a bank loan, and so on. At a national level, this drives an exponentially-increasing money supply. Isn't this the main cause of inflation? I'm no economist - happy to be corrected by any economists out there.

woah, this vid is sooo good, my economics teacher put this in class, and though hes such a great teacher, I dont think he would be able to explain inflation as well as this video. I do AQA economics in the UK GCSE, and this video literally covers every part of the exam board specification. What i like so much is that it explains each little bit, and then links it and explains the linkage, and then just summarises it perfectly. Honestly, if youre revising inflation in macroeconomics, this video is all you need, forget your textbooks!

Glad I found this channel. This knowledge valuable more than anything in life. Great video.

would also love more economics videos, this was great

Damn this was an amazing video !!!! I really loved how this was explained and detailed i was glued to the screen. Love it

Thank you for the amazing simple lesson!

First video of your channel I've seen and I'm amazed how in such a short period of time you managed to speak coherently on Inflation and it's causes as well as you got me hooked too. P.S. Sorry if I made a grammar mistake anywhere!

Who is here after the Fed announced they gonna be printing 2 trillion dollars for the stimulus package due to Corona?

best expanation ever. I have economics exam today, im sick and in my bed. i can't read or write as i am too weak for now. your video solvedc my proiblmes. thsavbk you

According to my perception Inflation is caused by 4 main factors that are 1) Cost-Push Inflation 2) Demand-Pull Inflation 3) Excess circulation of money 4) High debits /deficits

This was such a pleasure to watch!

Fantastic. I am teaching a class on macroeconomics, and this is such a great video to introduce the concept! Thank you :)

I spent the past hour or two reading ELI5s (Explain Like I'm 5) answers on inflation but only this video offered all three explanations (cost-push inflation, demand inflation, money-printing) so it feels like a nice finish and cherry on top of a night of learning. There's definitely a number of factors that come into play to simply write off inflation as a "good" or "bad" thing. One thing's for sure, though - if I were a financial adviser of some sort, I'd definitely leverage this video to today's youngins and urge them to start investing. INVEST!

Thank you so much for this useful data! Greatly appreciated.

All the respect for this cool video, #TheSchoolOfLife!

A very good visual demonstration of what inflation is. Please, how was this video created, I'll love to learn. Any suggestions is welcome. Thanks in advance.

Mr Alain de Botton produces very instructive and entertaining videos, I would like to congratulate you.

Thank you so much, you explain way way better than my college lecture.

This must have been one of the best RU-vid videos I’ve ever seen, thanks :)

I have to say, I do like The School of Life's economics videos. The are very informative and help break down complex issues into easily understandable chunks.

Can you do more videos on economics please?

Thanks for the clear lesson.

very neat presentation, thank you!

i'd like to congratulate you for a great video! you certainly made a brilliant clip on this one. it taught me things i have NEVER ever heard before in my life. all i ever thought before watching this clip is that the higher the purchasing power of the majority, the better the business and the growth of the nation's economy. it never occured to me that if everyone has the purchasing power of the same thing, that thing will increase its value (if the supply could not keep up with the demand) and thus purchasing power of the consumer class would have slightly diminish. that was such a great point! so thank you for that. however when you enumerate only 3 reasons for inflation, it seems that this clip is much more firstworld-centric in context. can you also give us your say about developing countries that went bankrupt due to say, corrupt dictatorship that resulted in a dramatic increase in inflation? it was a bit frustrating that it was not covered because it is quite a very important point as well. a dictator for example can increase the country's inflation overnight. it will steal a nation's public coffers and the whole nation's gold reserves, ship it out of that country and deposit it to tax havens and banks like those in switzerland, pitcairns, singapore and monaco. (result: countries like the philippines, or indonesia becomes a poor country overnight while singapore and switzerland happily become wealthier for accepting these ill-gotten wealth from the kleptocrats but this is another topic altogether)

Best video on inflation to be found on RU-vid.

Really well done and explained appropriately

Very nice video, explanation and also realisation. Keep doing it!

So basically it just comes down to greed.

Hi The School of Life! I love your work. What are your thoughts regarding inflation being inherently unfair and a burden on the poorest in society? Also do you think that the poorest in society should "just learn to live" with inflation, not to struggle against it?

I learned everything here, its complete... Pretty benefitable.., thanks

Nice explanation. Especially I loved the graphics which made it easier to understand.

1st impression: odd definition of inflation. Inflation=an increase in the quantity of money. Perhaps doing a review of Austrian economics(the best!), keynesian economics and monetarism are in order?

Sees inflation master 3000 Immediately thinks of I love you 3000

Incredible video, as always

This video is full of excellent information . Everything discussed in this video is very clear and very well explained for easy and better understanding . Thanks for taking your time to share such an amazing video with us

You know how everyone wants Morgan Freeman to narrate their lives? I want this guy.

I'm not kidding when I say that the market crash and high inflation have me really stressed out and worried about retirement. I've been in the red for a while now and although people say these crisis has it perks, I'm losing my mind but I get it Investing is a long-term game, so focus on the long run.

very informative video. Thank you.

Well done and well explained!

inflation is not hard to understand, if only people would explain it simply and correctly. 1st rising prices is not inflation but rather a symptom of inflation. Government is not directly responsible for inflation but are certainly complicit. Ok pull a dollar out of your pocket and look at it. That dollar is really only worth 2 pennies. looks like a dollar, smells like a dollar even feels like a dollar, but its only 2 pennies maybe less. That is inflation, see it for what it is and begin to understand inflation. Your dollar only buys 2 cents worth of goods and services. That is the effect of inflation. Not an increase of prices but a decrease of your purchasing power. Purchasing power. Your ability to buy goods and services. You work and earn currency, so currency represent your blood sweat and tears and time. So if your being paid in currency that is really only worth 2% of its face value. 98% of your blood, sweat, tears and time is being stolen away from you. Why is there inflation you ask? Good question. Short answer, world governments have given a sole monopoly of creating a nations currency to a handful of private corporations. I will say that again, Private corporations. Your currency does not belong to your country. It belongs to private corporations. These private corporations increase currency supply there by making each and every other unit of currency worth a little less. Why would they do this? Short answer, they trade worthless currency that they created from nothing but debt for valuable resources. Please explain you say. Well ok. How would you like it if you had a printing press in your basement. After your morning coffee you went down stairs and printed x amount of currency. What would you buy? And lets not forget that the government gave you the sole right to go down in to your basement after your morning coffee and issue as much currency as you wanted, so you don't have to worry about the jack boots kicking in your door and throwing you in to a cage. You would realize that the currency you were printing was completely worthless but it could be used to buy anything you want. What would you want after you had bought everything you could possibly conceive of purchasing including the moon. CONTROL. They steal your purchasing power so you must spend more time earning currency. The more time you spend earning currency just to keep your head above water the less likely you will analyze the situation and say hey wait, this is criminal, immoral, unjust, despicable. What kind of parasitic degenerates would do this to other human beings? The increase of prices is to deflect and conceal their theft. When the cost of loaf of bread goes up who do you blame? The Whole seller, the retailer, the farmers? Some of you might go so far as to blame the government. Very few actually put the blame squarely where it belongs. Private corporations given a sole monopoly of creating a nations currency. "If the people of the nation understood our banking and monetary system, I believe there would be a revolution before tomorrow morning." Henry Ford Sr

I watched this video to understand our inflation better which is at the moment 21,1% in Hungary. I found it sad and funny at the same time that the video mentioned our country as an extreme negative case. I guess that's how we have always been.

A video about ambientalism and economics would be interesting too!

If I would’ve just watched this video 4-6 years ago, my financial situation would be totally different. It’s insane you have to wait until college to learn this stuff.

Every financial goal requires patience, dedication and consistent spirit knowing that investment is currently the most lucrative business in the world, both NFT, real estate and Crypto shares are really positively changing people's lives.

I still don’t get it lol!

i just stopped the video to say: what an amazing work! thank you

that laugh and scene definitely fits this government/system and I'm sure you feel me! Great Job!

These past few days watching my crypto portfolio decline is very disheartening. Holding doesn't really profit much. Any ideas on how to earn better on the short run?

Do Austrian Economics!

Good job! I love watching these videos....

A well articulated content. Well done

4:18 keynes was never an advocate for inflationary policies

His voice is from heaven

Interesting,thank you for the information.

Incredible information thanks to this video now I know more about the subject, without a doubt very important, thanks I will share it with all my friends.

0:44 "Governments track inflation obsessively, and try to keep it low." That's actually not true, the central banks, which are *not* a part of the government, control money printing and 'fighting' inflation. Private banks are a private and un-elected entity that ultimately dictates the wellbeing of the world. It's scary because they can't be audited, so everything they do is hidden from the public and the government. 2:40 "Everyone loves tax breaks, because they raise disposable income. But in the longer term, raising demand also causes price rises" False. Price rises are more often than not caused by heavier money printing, and nothing more. This is Keynesian nonsense to suggest that in a perfect, debt-free economy that tax breaks 'somehow' raise prices. If anything, that would lower prices because that would mean more more productivity, more goods, and therefore lower prices.

I need to buy some gold

Wow, thanks for succinct explanation yet very efficient. This video makes it easy to learn about inflation.

very informative video, thank u

You forgot the main reason for inflation: GREED

Do basic income! :)

Thank you for making these videos! I learn a lot with them

Very insightful and articulate.

If the UK is experiencing a housing crisis, why would the government or the people be willing to accept a very large amount of migrants into the country when space is so limited and expensive?

The video refused to reveal the #1 reason for inflation, far above all other factors. The government intentionally causes inflation so it can default on the enormous debt it has created. That's it, that's why we have so much inflation. This video also: 1) De-emphasizes the actual definition of inflation, which is simply an increase in the money supply. Everything else is just a bubble of some kind. 2) It ignores the fact that government is always the source of things not inflating or deflating at the same rate. (aka bubbles). 3) It favorably depicts and explains government backed Keynesian economic theory, without even mentioning it's opposite, Austrian economic theory. This is blatant favoritism, it's like saying there is a political party called the Republicans without mentioning the existence of the Democrats. 4) There was also a veritable lie at 0:53 "...governments can say with amazing precision, how the interest rate is going". Completely false, it is well established that governments lie about and under-report the inflation rate to cover up just how much inflation they are actually causing to help them default on their debts.

Beautiful video well explain. Straight to the point no fluff

this is really very interesting and also very educative.in fact, we want more of this.