system
Given the following post, respond as if you're commenting on Reddit:
human
Why was the federal reserve unable to prevent inflation in the 1980’s?

I saw that 1979, inflation was 11.35% and in 1980, it was 13.5%. If the federal reserve’s target rate is 2%, how did they allow the inflation to get so out of control?
gpt
The 1970s and 1980s saw a paradigm shift in economic thinking about inflation. The phenomena that existed at that time is called "Stagflation" because there was both inflation and high unemployment at the same time. According to the dominant theory at the time (Keynesianism) this should not have been possible. Monetarism was the new theory that did a much better job explaining the stagflation of the 70s/80s. The following decades would see many attempts to merge keynesianism with monetarism into a single theory.

&#x200B;

tldr; they were still figuring it out. we have better understanding of inflation today than we did back then. but we still dont know everything.