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effects of inflation

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Title: effects of inflation
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Subject: Miscellaneous
Date: August 1, 2009
Length: 2 / 531
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This consumer spending heats up the economy even more, leading to further inflation - this situation is known as spiraling inflation because it spirals out of control. It is also important if people holding bonds or Treasury notes. These fixed price assets only give a fixed return each year...
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It is also important if people holding bonds or Treasury notes. These fixed price assets only give a fixed return each year. As inflation spirals faster than the return on these assets, they become less valuable. As they become less valuable, people rush to sell them, further depreciating their value...
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