Ok, I've not run across a book outlining the causes of stagflation, but I think I've figured it out on my own:
"Stagflation is caused when the cost for a necessary good or service inherent in the production or the supply chain (such as energy or transportation) is artificially elevated by an outside entity that is relatively immune from the effects of supply and demand on pricing. The net result is that that elevated costs inherent in the good or service must be passed on through the production or supply chain. The consumers reaction to this is to decrease consumption or purchases where possible."
Ok, thats my definition.
So I think that passing a proposed law that places big taxes on carbon footprints will generate stagflation because the price of necessary goods will rise as the higher energy cost works its way through production, so the people will try to cut consumption where they can.
In light of this, my question is...what were good investments to be in during the stagflationary period of the 1970s? I remember that precious metals did well. What else?
SM
"Stagflation is caused when the cost for a necessary good or service inherent in the production or the supply chain (such as energy or transportation) is artificially elevated by an outside entity that is relatively immune from the effects of supply and demand on pricing. The net result is that that elevated costs inherent in the good or service must be passed on through the production or supply chain. The consumers reaction to this is to decrease consumption or purchases where possible."
Ok, thats my definition.
So I think that passing a proposed law that places big taxes on carbon footprints will generate stagflation because the price of necessary goods will rise as the higher energy cost works its way through production, so the people will try to cut consumption where they can.
In light of this, my question is...what were good investments to be in during the stagflationary period of the 1970s? I remember that precious metals did well. What else?
SM