The reality of economic conditions is that we experience inflation, recession, or some condition in between. In recent memory, over time, it’s usually a matter of degree, because it seems that regardless of what the so-called experts say, prices seem to go up! We are experiencing, what seems to be, an inflationary period, in the last few months, with prices going up, in almost all areas of life! Prices of houses, cars. Building materials, groceries, etc. are all more expensive! However, it is important to remember and consider that we have just been through one of (if not the worst) pandemic in the history of this nation, including: quarantines, business closures, supply chain challenges/disruptions, etc. , and no one knows, for sure, what the future could bring. Will this period be a longer or shorter term challenge/hurdle? With that in mind, this article will attempt to briefly consider, review, examine, and discuss possible causes, perceptions, concerns, strategies, and next actions.
1. Reasons: Simply speaking, inflation is a prolonged period of rising prices across the entire economic spectrum. Precisely what causes this varies, but most of us remember various inflationary periods, as well as other periods of more stable economic/cost/price conditions. How much does the pandemic have to do with what we are currently experiencing, and what else can be factors? Due to concerns, due to unemployment, business closures/challenges, government subsidies, federal deficits, and historically low interest rates, many components of our economy are affected!
2. Perceptions: Our citizens’ perceptions have a significant impact on our economy. When consumer confidence is higher, people spend more freely and across the board. When, it’s not, general economic conditions, slow down!
3. Concerns: The worrisome part of inflationary conditions is our fears of losing ground to the rising cost of living! How long will people be willing to pay the huge increase in the purchase price of a house? How long will interest rates stay at record lows? When food, gas, and most other things get more expensive, and eventually wages/salaries no longer keep up, what will happen to the overall economy?
4. Strategies: This nation, politically, is a divided country! We have never witnessed the degree of partisan politics that we see today! How much should the government subsidize, what should the priorities/targets be, and for how long? How much is too much versus too little? Perhaps the biggest potential difference is the inability of our elected officials to see the big picture in a relevant and sustainable way, instead taking the path of least resistance and using the populist approach. ?
5. Behavior: On what the final outcome and ramifications of inflationary periods may depend, the strategies and actions that those, in positions of leadership, pursue and take!
Wake up, America, and recognize the potential impacts of inflation, both in the short and long term! Will you demand, responsible action, or will you accept, the same-old, same-old excuses, etc.?