Nurturing Financial Freedom

Inflation: Here to Stay?

Episode Notes

After a brief check of the markets over the last month, we jump into today's big topic.

Inflation has been a major topic in the financial media lately. The question is: Will current inflation be transitory (temporary) or will it last?  Today, Ed Lambert and Alex Cabot of Birch Run Financial play devil's advocate and present each side of the argument.

First, Ed outlines the argument that inflation is here to stay:

• The Fed has changed their guidance to allow for inflation to average 2%, and it's previously been low.
• The Fed is currently more interested in maximizing employment than managing price stability.
• The money supply (M2) is 20% higher than a year ago, and the dollar may weaken.
• There are labor supply shortages.
• Inflation often leads to more inflation.

Next, Alex explains why other experts believe inflation is temporary.

• Supply chain bottlenecks will soon ease up.
• Stimulus money that we received will eventually be spent.
• April CPI data was driven largely by the used car market, not a commodity that people tend to buy often.
• Unemployment in the service sector has driven price increases.  As extra unemployment benefits dry up, those industries will see people return to work.

While Ed and Alex both present compelling arguments on each side, they believe the truth may be somewhere in the middle. No matter what the future holds, however, the team at Birch Run is here to help you prepare for it.

If you'd like help with your financial future, connect with Alex, Ed, and the team at Birch Run Financial:

Website: www.BirchRunFinancial.com

Email: info@birchrunfinancial.com

On Facebook: Birch Run Financial

On Twitter: @BirchRunFinance

Phone: (484) 395-2190