If there would be another war in the middle east, will the inflation become worse?

Question

If there would be another war in the middle east, will the inflation become worse?

Answer 1

Inflation is a DIRECT result of Monetary Policy and nothing else.

Inflation means that "too many dollars are chasing too few goods".  If you have inflation, it means there is too much money in the economy. And in the 21st century where the supply of money is dictated by Government Policy (ie: The Fed Reserve), you can blame the Fed for any Inflation in the economy.

Answer 2

Inflation is not due to the war. The inflation is due to the illiterate morons that:

1. dont know how to read a contract

2. buy everything on credit

3. cheat there insurance companies

4. BUY BUY BUY.....and then go bankrupt

The war is actually saving us money, many people dont realize that our oil prices would be astoundingly higher than the HIGH gas prices we currently have. Dont get me wrong, Im not ignoring the fact that the war is costing us money. But thats money meant to be spent. Its like a school fund- the war is money sitting in the defense department. You  wouldnt borrow money from the baseball team to build a new football field!

Answer 3

This question shouldn't be difficult to answer, but first I have to adress "chevykid" above me. I have no idea where you get that idea, but I have never heard of any of those as causes for inflation.

Now to address your question. The original War in Iraq postponed our recession by a little bit because all that government spending contributed to our output. And it made sense for bush to start it, because republicans don't get elected during recessions. The problem is, that it just postponed the recession, and the governments poor fiscal policy of deregulating the mortgage industry is what caused the mortgage crisis.

Then the Federal Reserve logically began dropping interest rates to avoid inflation, but they've dropped them to the point where they can't drop them anymore. Another war in the middle east would maybe postpone a recession again (and even that is questionable), but then the recession will be a lot worse shortly after the government makes its initial investment into the war.

I hope that helped.