Given all of the COVID money, trillion dollar spending bills, supply chain issues, etc have been building up over the last few years, why does inflation ramp up suddenly all at once? Shouldn't it be more gradual?
roughly, changing prices has transactional and psychological effects, so suppliers hold out on price changes as long as possible, then do bigger changes (especially in non-liquid markets). So we see fewer big step changes in prices than smaller continuous changes (except for things that are traded frequently, like commodities).
Also there is a herd effect with consumer pricing. Once a market leader raises a price, that makes it 'safe' for other firms to match the price change.
COVID money also came with lockdowns, which reduced spending and thus delayed inflation. It also naturally takes time for inflation to travel from assets to commodities to consumer goods.
Furthermore there was no justification for raising prices other than "there's now a lot more money floating around, it's a free market baby".
Citizens wouldn't accept that, especially as most of them didn't get much richer from COVID money (mostly only asset owners did). But they can accept inflation when it's "caused" by a war instigated by a foreign dictator villain.
https://static01.nyt.com/images/2022/08/09/business/inflatio...
It this just purely gas prices? Or does the market just play along as if everything is good then freak out all at once?