Chapter 12. Inflation—Coexisting and Even Profiting with Inflation
Like death and taxes, inflation seems always to be with us. Well, perhaps not exactly “always.” Every so often, although rarely, periods of deflation (falling prices) show up, mainly during bad times for the economy.
Before we consider strategies for dealing with inflationary pressures, let’s define and distinguish periods of “good inflation” from periods of “bad inflation.”
What Is Inflation?
Inflation may be defined as a sustained increase in the costs of living, of goods, and of services—including not just the luxuries of life but also the essentials (food, clothing, housing, health care, education, and fuel). In recent decades, corporate managers and other highly paid workers ...