The first key to understanding inflation is to recognize the difference between real and nominal. If you think about a physical $100 bill, it is easy to understand that 50 years ago, it was still a $100 bill. We called it the same thing, it looked (mostly) the same...
When considering the value of an asset, what most people consider is the nominal value or “price” of the asset. When prices are going up, people get excited, and greedy. Rational analysis quickly gives way to fanciful visions of easy wealth. Conversely, when prices...
