Even Transitory Inflation Can Stick Around for a While
The episodes that followed the two world wars also featured big government deficits, loose monetary policy, and supply chain woes.
One of many service stations in the Portland, Ore., area carrying signs reflecting the gasoline shortage, in June 1973.
Photograph: U.S. National Archives
We often reach for historical parallels when discussing inflation. The stagflation of the 1970s gets trotted out the most these days, although cryptocurrency enthusiasts do love bringing up the hyperinflation of Weimar Germany.
True connoisseurs go for the deep cuts: the inflationary episodes in the U.S. that followed the two world wars. Both involved big government deficits, super-loose monetary policy, and supply chain woes. Both eventually gave way to eras of low-inflation prosperity.