which is the greater problem, inflation or recession?

Question

This is for a class in school (CSS-Contemporary Social Science) and it's my worst class so i would really appreciate answers! Thank you.

Answer 1

Inflation is due to an increase in the amount of circulating currency beyond the needs of trade. Over supply of currency thus created,in accordance with the laws of supply and demand,decreases the value of money, or more accurately increases the prices of goods and services. In the early 1980's recession lowered the inflation rate in the U.S. The opposite of inflation is deflation, a time of falling prices, curtailed business activity and high unemployment. Depression, in economics, is a period of economic crisis, characterized by falling prices, restriction of credit, reduced production, numerous bankruptcies and high unemployment. A less severe crisis is known as a downturn, or recession. Depressions now tend to become worldwide in scope because of the nature of trade and credit. Inflation, if it remains unchecked by some artificial means such as taxation and other fiscal measures, seems to be somewhat more of an agravation than recession as it can lead to downturns and severe economic dislocations ending in recession or worse depression, since consumers(which are one of the driving facets of economies)end up having less money that is worth less and thus purchases less. Maybe it's a toss up as to which is worse. Neither is economically good. It is essentially a balancing act, so when you come up with an economist that can perform such an act it is of some importance. Inflation may occur in times of political upheaval, and it commonly occurs during times of war, when governments borrow and when there is a limited supply of consumer goods. In the 1970's the onset of worldwide inflation was attributed to the soaring cost of petroleum.

Answer 2

It's an interesting question, and it really depends on the severity of the inflation or recession. Inflation is measured by the CPI. A recession can be measured by the change in GDP%. It's certainly possible to have both at the same time, that's Stagflation.



It really depends on your the person's economic status. If you're relatively wealthly, inflation would tend to eat away at your liquid assets and investments. Because you have more $, you have more to lose to inflation. You would still be affected by a recession because your investments would not do as well as before.



If you're of relatively modest means, a recession may likely throw you out of work, and you'll find it difficult to find another job. Inflation will also hit your pocketbook but you may find you're paid more too.

Answer 3

We had to go through the recession of the early eighties or just plain - "the eighties recession." My husband kept getting laid off jobs; we couldn't afford a house as the interest rates were at 15 - 20%. Terrible way to live - just like the depression. It's really hard for young couples and families to start out.



Inflation - is the result of our high gas prices - as we need our stuff trucked and shipped to where we live we have to pay for those high fuel prices somehow.

Answer 4

Economy can exist with a modest inflation during a very long time, but it can not exist in a steady state of recession forever. At the same time hyperinflation can harm economy more than weak recession.

Answer 5

actually because i have my own small business i do ok during inflation... when my expenses go up i raise my prices immediately [not like someone who may have to wait 1,2,3yrs for a raise]. in a recession business can get slow for me. that said if you have money in the bank and can keep it there till the recession has long passed you can clean up locking in 18- 20 % bank intrest for ten yrs.. it depends how financialy solvent you are .. remember the rich always get richer and the poor always get poorercause if you know how to do it money can be made comming and going ..

Answer 6

With recession, you could have large pools of people put out of work. With inflation, usually, unemployment is low, it's just that money earned last year isn't worth as much this year. I think recession is worse.

Answer 7

well on one hand lots and lots of people cant afford inflation on things like gas.. recession some times gets so bad that people dont get anything and witch they could die cause they cant get the food they need so i would say that i can walk so inflation would not hit me as hard as recession would

Answer 8

Short term - recession; which is why politicians do not want one to occur on 'their watch'.



Long term - inflation; which is why politicians are willing to spend, spend and spend on their watch, because the inflation may not come until it is someone else's watch.

Answer 9

I believe it is recession and infaltion. Recession is when people start to lose jobs and money such as the 1920's before the depression. Infalition is when prices go up and there is less money to go around.

Answer 10

Recession do not have money to buy the KFC 2 piece feed



Inflation have money to buy KFC 2 piece feed, but money worthless



I would say reccession as it destorys an individuals, wealth, thus they become homeless, cant pay rent, resort to pros

Answer 11

From economics point of view, perhaps it is inflation, as it is nearly impossible to reverse, should it become a serious issue.

Answer 12

Inflation -- a misused word. It is the printing of money, leading to the devaluation of what $s any of us hold.

Answer 13

I'm breathing in and out on this one -- inflation (breathing in)...recession (breathing out)....hmmmm, I can't tell which is the greater problem...I need to breathe in and and breathe out...so you have to have both.

Answer 14

inflation

Answer 15

ressesion