What is inflation?
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What is inflation and why is it relevant today?
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Hey, million bazillionaires, long time no see. Or here. Do we mean here? Long time no see or here. But hey, we're putting the finishing touches on our upcoming season. Trailer's going to drop soon. You're going to love it.
Yes, but that's still a few weeks away, and there's some big news happening right now that we wanted to hop into your feed and talk to you about. So you may have noticed gas prices have gone up all of a sudden. That's after the United States started a war with Iran, a country located in the Middle East where a lot of the oil we use to make gasoline is drilled.
We're going to talk about gas prices in the new season, but we've touched on them before in an episode we did back in season three about inflation. Back then, the cost of a whole bunch of things had gone up at the same time.
That's right. And a lot has changed since then.
How do gas prices relate to inflation?
Inflation did eventually get under control for the most part. We'll see if that remains true moving forward. In the meantime, though, listen to this episode and maybe it'll make whatever happens next make a little more sense. Hey, Ryan, what you watching?
It's one of my favorite holiday movies, The Man Who Saved Arbor Day. It may be old and scratchy and in black and white, but it's a classic.
Oh, dear. How will we afford the Arbor Day turkey this year? It costs 75 cents. We don't have that kind of money. We can't even afford 10 cents for Arbor Day yams. Perhaps your boss, Mr. Spendthrift, could help us. He's the richest man in town. He has over $1,000 to his name. But Mr. Spinthrift is the meanest man in town.
What historical context is important for understanding inflation?
He didn't even offer to pay for my heart surgery, which cost four dollars.
So what is this movie about?
It's mostly the characters worrying about money and saying prices out loud. But in a larger sense, it's about a man who's been cruel his whole life, suddenly deciding to be a good person. Here, let me fast forward to my favorite part.
Mr. Spendthrift. Yes, it is I, Mr. Spendthrift. And I'm here to save your Arbor Day celebration with a 75-cent turkey, some 10-cent yams, your $4 heart surgery.
Wow, things used to be cheap back then, eh?
And last but not least, I'm buying you all a new car for $300.
Oh, thank you, Mr. Spendthrift.
I'm a good person now. Forget all those years I was mean. This cancels that out. And may the Arbor Day spirit live on with you all.
How does inflation affect purchasing power over time?
It's me every time.
Yeah, it's a pretty sweet ending.
Sometimes you just need a good cry.
Welcome back to Million Bazillion. I'm Bridget.
I'm Ryan. Pull it together, man. I'm Ryan, and we help dollars make more sense.
We're here to answer the questions you have about money. And here's a good one that just came in.
Hi, Ryan. Hi, Bridget. My name is Alder, and I live in Helena, Montana. My question is, why is a dollar today worth more than a dollar in the future?
How does Alder know what a dollar will be worth in the future?
What role does the Federal Reserve play in managing inflation?
Wait. Can Alder see the future?
I don't think so. I think Alder must have figured out that you used to be able to buy more stuff with a single dollar because stuff was cheaper. Like you could buy a hula hoop in the 1950s for like $1.99. But now a hula hoop costs $12. And she's probably guessing that a dollar in the future will be able to buy even less than it does today. Maybe a hula hoop will cost like $20.
OK, so we're sure she's not a psychic. What number am I thinking of, Alder?
Pretty sure she's not psychic. And you don't need to be one to guess that prices of things are going to continue to go up as time goes on. They've been going up for years. It's called inflation. And we're going to talk about it when we come back.
What are the potential consequences of increasing prices?
And now it's time for asking random kids not so random questions. Today's question is, if you had a ton of money, what's the one thing you would do to help the world? I would spend the money to clean the ocean water. I would use my money to help Ukraine. to these four animals. Probably donate to local shelters. Of snakes. Um, sharing it. I would buy lots of trees and I would plant them to help air pollution. Donating to charity to save the people who don't have homes and others that that's important.
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Chapters
8 chapters
1
What is inflation and why is it relevant today?
0:00–0:48
2
How do gas prices relate to inflation?
0:48–1:37
3
What historical context is important for understanding inflation?
1:37–2:37
4
How does inflation affect purchasing power over time?
2:37–3:26
5
What role does the Federal Reserve play in managing inflation?
3:26–4:14
6
What are the potential consequences of increasing prices?
4:14–5:22
7
How can individuals respond to rising inflation?
5:22–6:04
8
What are the long-term effects of inflation on the economy?
6:04–26:59