¡Inflation!

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Greetings friends after traveling the great path of economics as a science, knowing its approach to studies, variables, economic models, the law of demand and supply, this time as an economist and teacher I want to share the importance of making the inflation, since it does not matter in countries that have a solid economy with national savings or surplus, every economy has low or high inflation levels, because not everything works, there will always be an unemployment rate and not everything we need to comply With our needs we produce it, but we have to buy it done and it causes inflation. In a dynamic way that inflation is so simple, my friend, it is the loss of the purchasing power of the currency due to several factors, I explain in the simplest way when in an economy economic models are applied where national spending is higher than social spending, that the same national income does not matter the political system of government but the applied economic models, as at present China, its system of government is communist and its economic models are capitalist battling via globalization.

In reference to the money supply, it is also an influential determinant of inflation, since it shows us the circulation of money and bank deposits placed in banks, but when there is a very acute inflation it shows us that a capital flight can occur and with it, the deposit placed in banks increases, due to the increase in the prices of goods and services, more cash is needed to buy, giving rise to a monetary liquidity which deals with how money is spent very quickly and to produce it. Continuing in this order of ideas we also have when the state or nation establishes bad monetary and fiscal policies to regulate the economy, where inflation is manifested by its excess of social spending, it prefers to make inorganic money to the central bank making possible more inflation, due to because it is not an income obtained from the gross domestic production of the country of its economic activity, causing the GDP to decrease, it also buys goods and services already finished abroad which can be produced in the nation also creates inflation, since it does not it stimulates the country's internal production by creating more unemployment and rising consumer prices, the most frequent types of inflation: Deflation, Reflation, Stagflation.