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The Return of Stagflation: "Stagflation is a term that originated in the early 1970s to identify the simultaneous occurrence of recession and inflation—a phenomenon that Keynesian theory had previously suggested was impossible. In Keynesian theory, recessions (and the unemployment implied by them) are cured by inflation, while inflations are cured by recessions. When both occur at once, the theory is not only seriously challenged, but fiscal and money managers are at a loss concerning what to do next."
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Christian Langreiter, Langkampfen