Simple. There is one bi-cycle in the world and nothing else. There is only a 10$ bill in the world. Cycle Cost = 10$ Fed Prints another 10$. Cycle Cost = 20$ Why does FED print more money? Because people prefer having money under their mattress / invest / bla bla other thank banks or simply because they don't have any. FED needs to fund people who need it for economic development (which is another topic). If people aren't willing to lend then someone has to. They print more money.
@YZB25 that is ONE reason for inflation but it could be caused by: demand-pull inflation (the general level of prices increase because of an increase in aggregate demand (total demand) in an economy), cost-push inflation increase in costs of production leads to an increase in the general price level.), too much money chasing too few goods (when consumer spending is higher than supply or production) and imported inflation.
@Raeez100 not necessarily. It's a mixture of CPI and interest rate, as real interest rate could be negative say if inflation is 5% a year and interest rate is 4%, real interest rate would be -1%
It is hard to simplify complex topics like our Fractional Reserve Banking System and the causes of inflation into a two minute video... so nice work on the effort.
Please consider in the future making a distinction between a money based economy and a credit based one. It is only because we allow Fractional Reserves coupled with a fiat money that we no longer require "savings" to generate (or even dictate the amount of) credit sloshing around in our economy.
Like the music. Decent animation for your first time. I suggest giving the stick figure a button that says "Yes, We Can" or creating a love story with a vampire to appeal to today's younger audience members.
0engima0 3 weeks ago
I'm confused: I thought inflation was caused when the government printed more money than it actually had thus making money worth less?
YZB25 6 months ago 2
@YZB25 that is ONE reason for inflation but it could be caused by: demand-pull inflation (the general level of prices increase because of an increase in aggregate demand (total demand) in an economy), cost-push inflation increase in costs of production leads to an increase in the general price level.), too much money chasing too few goods (when consumer spending is higher than supply or production) and imported inflation.
suhelisuheli 2 months ago
Yeah.. Interest is the one that causes inflation.
The majority think that interest is the one saving us from inflation!!!
Raeez100 6 months ago
@Raeez100 not necessarily. It's a mixture of CPI and interest rate, as real interest rate could be negative say if inflation is 5% a year and interest rate is 4%, real interest rate would be -1%
ASTEagle 6 months ago
Made with Stickman, I assume.
bvssvni 8 months ago
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Nice job on the video looks good. When you have time come visit my channel!
chocolatediet11 10 months ago
It is hard to simplify complex topics like our Fractional Reserve Banking System and the causes of inflation into a two minute video... so nice work on the effort.
Please consider in the future making a distinction between a money based economy and a credit based one. It is only because we allow Fractional Reserves coupled with a fiat money that we no longer require "savings" to generate (or even dictate the amount of) credit sloshing around in our economy.
jokertim777 2 years ago
Like the music. Decent animation for your first time. I suggest giving the stick figure a button that says "Yes, We Can" or creating a love story with a vampire to appeal to today's younger audience members.
-Tuna
jaredallenfan 2 years ago
Good video, daffy.
-Mogli
ZeLrocker 2 years ago