Jason Furman Explains How U.S. Approaches Inflation

The video discusses US inflation, focusing on core CPI and economic policies to avoid deflation. It explores investment strategies, emphasizing the need for a balanced financing mix and the role of tax reform. The impact of automation on productivity and inflation is analyzed, highlighting the potential for higher output and wage growth. Finally, the video examines income inequality, comparing current levels to the Gilded Age.

What was a significant concern for policymakers in the US regarding inflation in the early 2010s?

• Rising oil prices

• High unemployment rates

• Excessive foreign investment

• A self-reinforcing deflationary trap

How does the current tax policy in the US affect investment?

• It provides equal tax rates for debt and equity

• It discourages all forms of investment

• It results in a capital structure too reliant on debt

• It encourages more equity-financed investment

What is one potential benefit of increased automation in the economy?

• Increased inflation

• Higher output per hour of work

• Slower productivity growth

• Higher unemployment rates

How does the current income distribution compare to historical levels?

• It is similar to the Gilded Age of the 1920s

• It is more equal than in the 1920s

• It is less skewed than in the 1980s

• It has not changed since the 1950s

What is a key challenge in understanding the future trajectory of inflation?

• Predicting foreign exchange rates

• Forecasting government spending

• Understanding how investment will work

• Estimating population growth