It was the economic aftermath of the war in Vietnam. During most or all wars in modern times, price & wage increases due to wartime shortages were prohibited. Afterwards, inflation followed.
In 1964 or 65 Lyndon Johnson chose to conduct the Vietnam war without mobilizing the economy for war. I remember the phrase "guns and butter", to mean we can have a peacetime economy while fighting a war. In contrast, during WW2 the economy was quickly converted to wartime, guns and not butter.
After Vietnam, inflation broke out in the US, despite efforts by the Nixon/Ford administration to contain prices and wages. By the late 1970s/early 80s, it became bad. Interest rates were very high. Stock prices on Wall St. suffered, while bond interest rates were high. And prices for most everything rose and rose. At the same time, the Big Oil cartel took advantage by limiting oil production causing significantly higher prices.
I had a small retirement savings plan which paid more than 16% interest. Home mortgage interest rates were through the roof. I bought my first home in 1984, when interest rates had already peaked and had begun to slowly come down. The mortgage was a 3-year variable interest loan of 11½%. After 3 years, it had dropped to 9¼%. Not many years later, I refinanced to a 30-year fixed loan of 5½%. That still seems high today, but at the time, I was thrilled. It made a big cut in my monthly payments.
We haven't had such inflation since those post-Vietnam War days. When the pandemic hit, it created a whole new set of economic conditions than no one had ever seen before.
… And now, back to the pre-SB hype.
