Stagflation Versus Hyperinflation

Krugman, P. (2010). Stagflation versus hyperinflation. Retrieved March 18, 2010 from: http://krugman.blogs.nytimes.com/2010/03/18/stagflation-versus-hyperinflation/

This article was published in the New York Times, and was written by columnist and Princeton professor of Economics and International Affairs Paul Krugman. In it, he explains the difference between Stagflation and Hyperinflation and discusses our economy’s current condition. He states that many are becoming paranoid that hyperinflation is just around the corner, which Krugman does not agree with. Hyperinflation is out of control inflation caused primarily by the government spending more than they can collect and therefore printing new money to cover the deficit spending. This lead to inflation, which leads to the consumer spending less, which causes the need for the government to print even more money to make up for the smaller amount revenue that is caused by a slow economy. Stagflation, on the other hand, is a combination of high inflation and high unemployment, which normally go in opposite directions. Krugman does not anticipate either of these things to happen in the near future. This is a good article for students and managers to read. However, it is short on details, it does help leaders understand inflation a little better.