Four key factors in the 1970s were very different from present conditions, and that argues against 1970s-style stagflation as a model for 2010-2020.
Sometimes history rhymes--but only for the first line. On the surface, there are reasons to anticipate a 1970s-style stagflation in the decade ahead: a stagnating economy beset by rising inflation.
Four fundamental factors that profoundly influenced the economy in the 1970-1980 period are not present today. As a result, we must be careful not to expect history to rhyme stanza after stanza.
- Demographics: the Baby Boom came of age and started households en masse. Baby Boomers bought houses, cars, furniture, etc. for their new households, and started businesses which created even more demand. Full article at: Stagflation
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