Here is additional insight on some of the factors baked into the inflation equation, as we continue a dialogue on how The Topic of Inflation is All the Rage and The Topic of Inflation is All the Rage- the Sequel.
“Inflation today is transitory” we are told by the Fed. Meanwhile, we live through this economy and feel the cost pressure, don’t we?
Now, in every economic period there are unique stories where we may see a supply shock of a particular item that causes an increase in market price, or a weather event that wipes out an agricultural crop that leads to a commodity price spike, or a labor union strike that effects an industry. Any of the old timers remember the oil crisis of the early 1970’s? Now THAT was a supply shock and price inflation!
Looking at the chart above, we can certainly see a host of goods and services are spiking at the same time- this is probably more than a normal economy. To be only “transitory”, as they say, pricing is going to have to pull back quickly, with a big move backward.
Be careful out there!
~ Brian Kasal- The Leadership Matrix
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