Stagflation is a term that investors and economists fear. Find out what causes it and how it might affect your investments. Great Recession: Definition, Causes, and Effects We look at four factors that caused the worst economic downturn since the Great Depression. ...
Stagflationis a term used to describe a stagnant economy hampered not only by slow growth but by high inflation as well.2While this combination may seem counterintuitive, it proved real during the 1970s and early 1980s when workers in the U.S. and Europe were subjected to high unemployment ...
Making sense of a P&L statement can help guide your investments. We show you how. How to Read a Cash Flow Statement This little-understood financial statement can contain important investor information. Assets vs. Revenue: What's the Difference?
The problem began during the era's volatile interest rate climate,stagflation, and slow growth of the 1970s and ended with a total cost of $160 billion; $132 billion of which was borne by taxpayers.1Key to the S&L crisis was a mismatch of regulations to market conditions, speculation, a...
The second is maintaining price stability and moderate long-term interest rates. When deflation or rapid inflation occurs, the economy becomes unstable. Economic instability may also lead to investors losing confidence, fewer investments or even a recession. ...
when inflation is high, wages and employment are often high as well. But that's not always the case. In the event of a critical supply constraint (like an oil crisis), stagflation can occur. That's what happened in the 1970s, and it can be a concern during periods when inflation is...
Diversifying your investments could help reduce your risk when inflation is high.Like the ocean, the economy naturally moves in waves—2 of which are inflation and recession. During inflation, prices for goods and services increase. During recessions, the economy slows, and unemployment often rises...
However, the worst fear after a Fed rate cut isn’t upcomingeconomic devastation. Household and corporate balance sheets are strong, and access to credit has been more restricted since 2008. If we do experience a recession, your investments might lose 10% to 25% in value, nothing as severe...
are low, banks would prefer to lend those funds out for a greater return, increasing the availability of credit and lowering the cost of borrowing money. On the flip side, banks would prefer to keep more money at the Fed when rates are high, especially if it means they don’t have to...
Can any good come from an economic collapse? While it's hard to see any silver lining in a total collapse, some benefits have been seen in past recessions. During the Great Depression, for example, life expectancies actually increased. The cost of housing may go down, enabling some people ...