Inflation explained in under 3 minutes

Inflation is a monetary phenomenon in which consumers see a broad rise in the prices of goods and services across the economy over time

Sustained periods of inflation are often caused by central bank policies including low interest rates or increased money supply. With more money chasing the same number of goods and services, prices tend to rise and the value of a single dollar drops.

An updated, comprehensive tracker of global inflation

This tracker provides a visual narrative of inflation rates, central bank policies, consumer price breakouts, and more from nations across the globe.

US inflation can generally be split into to two periods—before and after the Federal Reserve

A central bank itself does not mean significant inflation will occur, but economists generally point to factors like two world wars and the printing of money to finance the US federal deficit as primary drivers of price increases.

Prices can still feel high even if inflation is slowing

This is partly because a recent spike in inflation raised prices permanently, so even though the pace of price growth has slowed, prices have still gone up for good.

Disinflation, a decrease in the rate of inflation, is different from deflation

Disinflation happens when prices are still going up, just at a slower rate. Prolonged disinflation is also often accompanied by a recession, making it painful for consumers.

The highest inflation ever recorded in US history was estimated at 30% in 1778, just after the Revolutionary War.

'Good deflation' happens when prices naturally track with supply, meaning prices change gradually

This tends to make products and services more affordable and normalizes the standard of living. Bad deflation usually happens when there are sudden changes to either supply or demand. Near-zero [interest rates helped create the real estate bubble that sparked the Great Recession when it crashed](https://www.youtube.com/watch?v=LMo9mD8j7IA&t=91s) Because deflation distorts the value of money, deflation is particularly harmful for borrowers. Low interest rates made it easy for businesses and everyday people to take on enormous debt, which exacerbated the effects of the recession.

Raising interest rates can help control inflation

While controlling a complex and dynamic economy is difficult, interest rates—more specifically, the rate at which banks lend each other money overnight—are a powerful tool. Generally, raising the rate makes purchases more expensive and cools an overheated economy.

Economists define deflation as a sustained decline in prices across an economy

Deflationary periods are characterized by broad, significant price declines. The Federal Reserve can monitor deflation by tracking prices through price indexes, such as the Consumer Price Index (CPI), which characterizes the average costs for consumers each month.

The Federal Reserve targets 2% inflation

It’s an arbitrary number originating from an offhand comment made by a New Zealand policymaker. The real objective is to maintain predictable prices for businesses and families to plan around while avoiding the dangers of deflation.

33% of Americans say they don’t know very much about what the Fed does

While most Americans grasp the central bank’s impact on curbing inflation, they don’t know that the Fed is tasked with what is called a “dual mandate” to provide price stability and maximum employment. Furthermore, few understand the Fed is independent—it does not answer to Congress or the US president.

Watch Ray Dalio explain how the economy works

Dalio describes the economy as a machine that runs on three main cycles: productivity growth, the short-term debt cycle, and the long-term debt cycle. Dalio says layering these three cycles on top of each other essentially creates a template for understanding changes in the economy.

Fast-food prices have increased more over the past 10 years than both full-service restaurants and inflation.

Inflation was a word before deflation was

The word inflation has Latin roots and technically means an influx of air, first appearing in the English language in the 1890s to describe bike tires. Deflation's first known mention in an economic text was in 1919.

Learn about what causes economic bubbles, including how forces like cheap credit, soaring optimism, and feedback loops push asset prices far beyond fundamentals—until a single shock triggers panic, selling, and a rapid collapse.

Bitcoin explained and made simple

Bitcoin, the most popular and well-known example of a cryptocurrency, came on the scene around 2010, with its evangelists proclaiming it would eventually displace government-backed traditional cash. While the concept of a digital currency may seem straightforward, the details can be deceptively simple. This quick video overview provides the foundation for a deeper dive into the world of decentralized currency.

The psychological aspect of deflation makes it difficult for policymakers to stabilize the economy

That psychological aspect is referred to as "the deflationary spiral." When prices start decreasing, people tend to hold on to their money to pay the lowest prices. But as prices start stabilizing, people resist increasing prices. (Some users may experience a paywall.)

Learn how stablecoins function in just 4 minutes

This video explains the basics of stablecoins in a beginner-friendly manner. It also dives a bit deeper into the larger stablecoin landscape, detailing, for instance, the many stablecoins backed by fiat currency other than the US dollar, like the euro, the Turkish lira, and the Singapore dollar.

Check the current Consumer Price Index

The Consumer Price Index is a metric that attempts to capture price changes felt by consumers by averaging a basket of about 80,000 items, each weighted to reflect the impact of changes on households.

A brief explainer on food expiration dates and what they really mean

Roughly 20% of food items in the US are thrown out because consumers don't understand how to interpret expiration labels. Over time, when supermarkets began carrying processed foods, grocers use packaging codes to track how long foods had been on...

Vitalik Buterin explains ethereum in 30 minutes

Every year, ethereum creator Vitalik Buterin explains what his crypto platform is in a 30-minute presentation at the Ethereum Foundation’s event, Devcon. Buterin’s explanation goes deeper than a simple 101 explanation. To learn more about the current state of ethereum, what’s changed recently, and what Buterin expects down the road, watch this video.

The role stories play in mass economic trends like bitcoin, crashes

Economics is dominated by numbers, but stories play a huge role in the emotional shifts seen within macroeconomic trends. For example, bitcoin is not just a cost-benefit winner, but a compelling tale of decentralization and independence. This is a 20-minute summary of Nobel prize-winning economist Robert Shiller's "Narrative Economics."

'Deinfluencing' explained

You’ve probably heard of influencers, but have you heard of “de-influencers?” Basically, the de-influencing trend started when creators began making videos about products you shouldn’t buy, rather than sponsored content promoting things you should purchase. Comedian Taylor Tomlinson recently cracked some jokes about the trend, and its companion “under consumption-core.”

Venezuela is experiencing hyperinflation

Consumer prices in the country have risen at a fairly quick rate since 1983, but a series of policy miscalculations, falling oil prices, and other factors have sparked extreme levels of inflation since 2017, with citizens losing faith in the value of the national currency.

The stock market, explained in 3 minutes

The stock market consists of a set of exchanges and other venues where shares of public companies are bought and sold. The Nasdaq and the New York Stock Exchange are two of the most well-known exchanges in the US, while major exchanges also operate around the world, including in Tokyo, Shanghai, London, and São Paulo.

Modern Monetary Theory 101

Modern Monetary Theory is a macroeconomic theory that says government spending should not be restrained by fears of rising debt. Here's a breakdown of how the theory works.

Why does the stock market matter?

Open any newspaper, turn on your local TV news station, or listen to a daily business radio segment, and you’re bound to hear about how the stock market is performing. Netflix created a 17-minute (free) explainer that dives deep into the nitty-gritty of how we got here.

See every time the minimum wage has been raised.

Read former Fed chair Ben Bernanke's 2002 speech about preventing deflation

Very low inflation rates in the early 2000s in the United States and a worsening recession in Japan sparked some domestic concern over the threat of deflation. While Bernanke wasn't Chair at the time of the speech, he emphasized the Fed's role in preventing deflation.

40 key stock market terms, explained

Liquidity. Forex. Capitalization. Blue chip stocks. These are just a few pieces of stock market vocabulary most people who don't spend all day on a trading floor might not know. Thankfully, we found a fun infographic that makes it easier to learn what 40 key stock market terms mean and why each of them matters.

In President Trump's first year of his second term, inflation fell from 3% year-over-year in January 2025 to 2.7% in December

While the price of eggs and bread went down over Trump's first year in office during his second term, coffee and beef prices rose. Utility bills and home insurance continued to surge, but mortgage rates, rent, and home prices began to stabilize in 2025.

How do vaccines work? Watch this brief 101

Watch this under-3-minute video explaining how vaccines use the body's immune system to prepare our bodies against viral and bacterial threats to our health.

The world's most famous case of deflation happened after Black Thursday

While the details are not fully agreed upon, many economists point to the Federal Reserve's tightening of the money supply as a prime culprit, leading to a significant deflationary spiral.

An economist answers questions about love

Economists aren't exactly known for their dating advice. But as it turns out, economics experts can offer fresh perspectives to everyday romantic quandaries. On this podcast episode, economist Tim Harford answers listeners’ relationship quandaries, from paying for a first date to alternatives to saying, "I love you." Listen to the episode here.

Explore 'The Big Mac Index,' an economic indicator created by The Economist as a cheeky reference for the purchasing power of consumers across different countries.

Listen to a podcast episode from 1440's editor in chief that explains how a credit card transaction works behind the scenes.

When you buy even something as small as a $5 latte, a global relay between banks and networks like Visa and Mastercard is triggered. It all started with a 1958 campaign from Bank of America that jump-started the credit card revolution.

The US Mint created a video to show kids how coins are made

The video, made simple for children (or anyone who wants an easy-to-understand 101 video about the process coins go through to get in your wallet), outlines the entire process that a coin goes through in its lifetime, from Congress voting on new coins, to how coins are stamped, to their journey to a Reserve Bank.

Bank runs, explained

A major feature of the modern financial system is trust: if an institution loses it, customers will quickly withdraw deposits and stockholders will sell their shares. This digestible animated video looks into the nature and history of bank runs and...

How do tariffs work?

This brief animated video from Time walks through a simple example of a tariff on a single good, illustrating how this would affect the market for the good—both domestically and abroad—and who would eventually bear the cost of the tariff.

How chaos helps explain why small market corrections can produce major economic instability

Oxford University complex systems professor Doyne Farmer discusses how predictions from many economic models are overly weighted toward simple relationships, such as supply and demand, and external shocks, such as the COVID-19 pandemic. However, real-world macroeconomic systems involve public and private actors interacting, producing feedback loops and cascading effects that resemble the oscillatory behavior seen in chaotic systems.

The Federal Reserve can set interest rates below zero

Interest rates, the cost of borrowing money, are the primary tool the Federal Reserve uses to control inflation. During periods of deflation, setting interest rates below zero penalizes saving, encourages banks to lend more and moves more cash through the economy.

US cities where inflation is rising the most

WalletHub compared 22 major metropolitan areas to see how inflation has risen in the last year using the Consumer Price Index, which describes the average cost of a basket of goods. As of April 2024, Honolulu, Hawaii, clocked in with the greatest year-over-year change in prices, with inflation close to 5%. See the full list here.

Learn how 'real' and 'nominal' gross domestic product differ, with real GDP being adjusted for inflation and nominal GDP reflecting current monetary values.

China had an inflation rate of -0.4% in August 2025

As opposed to other G20 countries that are largely struggling with high inflation rates, China is facing deflation. Sluggish growth in the country's once booming real estate market is just one glimpse into the consumer slowdown triggering deflation.

President Trump's 2025 Tariffs added less inflationary pressure to the economy than expected in their first year

A year after the so-called "Liberation Day" in April 2025, tariffs have had a milder effect on inflation than feared—core goods prices have added only about 0.2% to the headline Consumer Price Index—but persistent policy uncertainty has rattled small business owners, who say the constant back-and-forth makes long-term planning difficult.

A simple visual explanation of how blockchains work

Blockchains are decentralized, distributed, and digital methods to record transactions and prevent alterations and tampering of the record. That's a simplified definition. This easy-to-understand six-minute video further and better explains what blockchains are and how they work using colorful illustrations and clear, concise clarifications on their processes and what makes them so special.

Bitcoin started as a .PDF

Have you ever wondered how bitcoin became, well, bitcoin? In this podcast episode, journalist PJ Vogt dives into what drove the bitcoin hype machine, explaining how it became the phenomenon it is today.

Compounding, explained

During conversations about personal finance, the term "compounding" gets thrown around—but not everyone understands how compound interest and compound returns work. Broadly speaking, compounding is what happens when you not only earn returns or interest on your original investment, but also on the accumulated returns or interest you receive over time. This article explains how both of these processes function, and what compounding could mean for your wallet.

How interest rates affect homebuying

Rising interest rates impact every aspect of buying a home. This five-minute article gives a high-level overview of the relationship between the housing market and interest rates.

'Loveflation' is making dating more expensive and less frequent

A survey found that more than half of Americans are going on fewer dates due to rising costs, with 27% stopping altogether. Gen Z and millennials are the hardest hit, with 62% reporting changes in their dating habits due to inflation.