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?
June ’21 CPI- Year Over Year
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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