Experts Sound The Alarm As “Bidenflation” Sinks Its Teeth Into American Economy
(LibertySociety.com) – Ever-increasing inflation is causing the price of virtually everything to increase, and some experts say it shows no signs of slowing down. In fact, the consumer price index (CPI) data released in April reported an increase of 8.5% year over year, which is on par with the outrageous inflation seen in the 1970s and early 80s. The impact on American family budgets has been devastating for many people nationwide. Contrary to opinions from the Biden administration and some experts saying the inflation is transitory, others believe the end is nowhere in sight.
Federal Reserve Chairman Jerome Powell stated he anticipates inflation rates remaining high through the first half of 2022 but to begin its decline during the second half and drop “sharply” in 2023. In order to slow down the inflation rate, the Fed increased interest rates in March and May and expect to do the same in June and July. The body expects this measure to slow down inflation as borrowing money becomes more expensive, causing a decrease in spending and consumer demand.
However, investor and billionaire David Rubenstein has a different point of view. He said Americans need to continue to worry about inflation for years to come. He believes once inflation takes a foothold, it’s difficult to root it out. While speaking at The Milken Institute’s Global Conference recently, the financial expert predicted America would see inflation continue at a rate of 5% or 6%. The institute’s chief economist thinks the rate will stay over 3.5% over the next 5 years before starting to decline.
The Impact on Americans and Preparation
Soaring inflation rates while many American families are still reeling from the economic effects of the pandemic is taking many to the brink of financial ruin. Those who live paycheck to paycheck have to find creative ways to pay their bills while putting food on the table. Some must choose between the two. With no more protection measures in place from the government for mortgages and rent, some people in the United States might find themselves homeless as a result of prolonged inflation and rising interest rates.
To prepare for sustained inflation rates, look over your budget and cut out unnecessary expenses. Consider placing the money in an investment vehicle that historically outpaces inflation, like an index fund or real estate. Pay down any debt you carry outside of your mortgage and build up an emergency fund equal to a few month’s worth of expenses. Consider adding more education to your belt and maybe secure a side hustle to bring in extra cash.
While not many are immune to inflation fallout, taking steps now to prepare for the possibility could lessen the sting in the near future.
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