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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Stagflation

Definition:

It sounds like a class at Starfleet Academy, but it's really a combo of inflation and stagnation—and it's really bad news for the economy.

Stagflation happens when the economy isn't growing. It's stagnant, which means low interest rates, few jobs, few opportunities. Things are sluggish. At the same time, there's inflation; the cost of stuff is going up, which means people can afford less stuff, which means less demand and fewer jobs... sensing the vicious cycle yet?