Why do prices go up over time?
The Stretching Dollar
Why do prices go up over time?
Your grandma tells you that when she was young, a movie ticket cost two dollars. Two dollars! Now it's fifteen. A candy bar that was fifty cents is three dollars today. Did money break? Did everyone forget how to count? Not quite — but something interesting is happening, and it's been happening for a very long time.
Here's the short answer: prices go up because we keep printing more money. Imagine you and nine friends are trading marbles. There are one hundred marbles total, and everyone agrees one rare marble is worth ten regular ones. Now someone dumps a thousand new marbles into the game. Suddenly your rare marble isn't so rare — people won't trade as much for it anymore. Money works the same way.
