tag:blogger.com,1999:blog-8177055754833039617.post5621430514817644094..comments2024-01-13T00:06:31.649+07:00Comments on Kimsoeun and Katherine's Khmer Kronicle (main blog): Inflation part 2Katherinehttp://www.blogger.com/profile/11196970876569595028noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-8177055754833039617.post-91292388451608544562008-04-15T12:10:00.000+07:002008-04-15T12:10:00.000+07:00Prices of commodities are rising worldwide because...Prices of commodities are rising worldwide because the demand exceeds supply. In the medium to long term the supply hopefully will catch up, but in the short term it's normal for consumers to try and find cheaper substitutes. That is difficult when it involves staple food products and power. Governments can make the problem worse if they create excessive money supply (too much easy credit or simply printing excess money) and then all goods and services increase in price. That's the worst inflation and is a scourge some greedy governmnets put on their citizens especially the poor. The best solution is for the supply to increase, that is why the exporting countries are ceasing their exports. We can pray for a good rice season in Cambodia to ease the burden on the poor. The other thing that happens in severe inflationary times is that people buy in larger quantities and hold their savings in commodities that can be stored safely instead of cash. Another option is to keep ones cash predominantly in a strong international currency relative to other currencies. The A$ is such a currency and has appreciated against the KHR and US$.Anonymousnoreply@blogger.com