Comment , and thank the discussion below and please reply to the questions :

Great article and great use of simplistic everyday items to describe the content of the article and the class content. The referenced article was fascinating - Investopedia is always a good read, regardless of the topic. Question 1: The largest consequence of stagflation in my mind is consumer purchasing power loss. If we see inflation go up and unemployment stays relatively low, we will have even more competition for jobs that may result in people having to hold steady at their current jobs and salary losing the quality of life. The American dream of the middle class could really be in jeopardy. In my professional career, it also worries me as this may lead to businesses holding off on investing due to the unclear future. Question 2: As you noted in your summary this is a seesaw problem. The readings and teachings of module 6 offer us, models, to try and predict how actions on one side of the seesaw will cause action on the other side. From the readings attempts to combat this takes a mix of monetary and fiscal policies to try and stabilize the economy. We would expect tighter monetary actions with the hope to curb inflation if we we were in a expanding economy. Due to the fact we are not technically in a recession we would hope the actions of our government follow this tactic.

Questions to be answered :

The question I have based on everything I have been reading and learning is do we really know what the solution is? If it worked in the 90's does that work now? The economy is different now, time changes all things. I would assume that is why we learned about, and economists use the different expectation models. It will be interesting to watch this closely in the coming months how and what they apply.