To fight inflation, the Federal Reserve has raised short-term interest rates by half a percentage point. The Fed will also likely be raising rates a half-point at its next two meetings after that. It is trying to avoid the risk that consumers’ and businesses’ expectations of large price increases could become baked into price and wage decisions, creating a self-fulfilling inflation spiral.
That has happened before and when it does, it’s a disaster and it just proves that things can actually get even worse for you and your wallet. None of us has a crystal ball, but it does seem that the Fed has been wandering around with blinders on for a long time and their new strategy smells a lot like panic in the year zero or in this case the year 2022. So where does that leave all of us right now?Continue reading“Where Is Inflation Going and What Are You Doing to Fight Inflation?”