Word of the day: stagflation

The American Dialect Society recently chose 'subprime' as their word of the year, and on a similar note I think 'stagflation' is a word we'll be hearing more of in the next 12 months.

A portmanteau (blend) of 'stagnation' and 'inflation', as you might imagine it describes a situation when inflation is high but the economy is stagnant. The word has been around since the 1960s, and the phenomenon occurred throughout the world in the 1970s, but I'd never heard of it until recently.

I particularly like it because it makes me think of those giant inflatable reindeer that people put outside their houses at Christmas – see picture.

The Wikipedia page on stagflation is informative, but heavy reading if you're not really well up on macroeconomics.