Inflation and Bubbles and Tulips: Crash Course Economics #7

In which Adriene and Jacob teach you about how and why prices rise. Sometimes prices rise as a result of inflation, which is a pretty normal thing for economies to do. We’ll talk about how across-the-board prices rise over time, and how economists track inflation. Bubbles are a pretty normal thing for humans to do. One item, like tulips or beanie babies or houses or tech startups, experiences a rapid rise in prices. This is often accompanied by speculation, a bunch of outrageous profits, and then a nasty crash when the bubble bursts. People get excited about rising prices, and the next thing you know, people are trading their life savings for a tulip bulb.