19 May Should we be concerned about stagflation

Should we be concerned about stagflation?

What is it?

Stagflation is when we have slow economic growth and at the same time rising prices (inflation. Can this happen to us? The answer is that because of the pandemic and higher prices of everything we have record inflation. Also, Russia’s invasion of Ukraine has increased oil prices and that also ads higher gas prices but also all the products that are made with petroleum. So, we do have high inflation right now. Combine that with a slowing of our world economy because we cannot get the products to sell and raw materials to create them are getting harder to get every day. An example of supply issues right now is that 40 percent of China’s output is shut down because 400,000 people are in cities that are totally locked down with Covid. This has a ripple effect throughout the world. Combine that with Ukraine who produces 30 percent of the world’s agriculture product like wheat, grains, and corn has its ports blocked by Russian ships and food prices are skyrocketing. So, by the definition we are quickly approaching stagflation with no remedy in sight.

 

What do the experts say?

The United States Treasury Secretary, Jent Yellen, said on the 7th that “The economic outlook globally is challenging and uncertain,” Yellen said. “Higher food and energy prices are having stagflationary effects, namely depressing output and spending and raising inflation all around the world.”

 

What is a sound investment during these challenging times?

Real estate!

I hope you found my blog on “should we be concerned about stagflation?” helpful.

Just call, text, or email me with questions.

Jeff Anderson

The Anderson Team

www.mnrealestate.com

RE/MAX RESULTS

612-386-8600