this post was submitted on 18 Nov 2023
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In the past, governments didn't have inflation targets. The black friday event involved the government flooding the gold market, dramatically reducing the value of gold. At the time the value of a dollar was directly tied to the value of gold. In hyper-inflation events (that don't often happen in developed countries but do still happen in some countries around the world), inflation may be 50% or 100% or 200%. Sometimes way more.
These days (the last 30 or 40 years), inflation and gold have been decoupled, and instead the government has a target range of approx 1-3% inflation (depending on your exact government, but if you're in a developed country then it is probably close). This was intended as a target that would allow businesses to have some certainty and was low so they could ignore inflation in their forecasts. The original target range was 0-2% set in New Zealand, but as it spread around the world it got slightly adjusted to a 1-3% range.
The governments now try to directly control inflation by changing the cost of borrowing money. You might have recently had inflation hit as much as 9%, but this is nothing like what happened in the old days.