Featured Post from Cedarville University

With an economy on life support – is inflation inevitable?

Jun 22, 2020

2 min

Jeff Haymond, Ph.D.


As countries around the globe are flooding their respective economies with enough cash to hold back the financial tsunami that could be felt by COVID-19 … will all that cash inevitably come with an unfortunate consequence like inflation?

Those who work the markets and do their best to see into the future … think so.

 

With the world economy forecast to shrink 6% this year, it may seem like a strange time to fret about inflation.


And sure enough, market-based gauges suggest an uptrend in prices may not trouble investors for years. U.S. and euro zone inflation gauges indicate that annual price growth will be running at barely over 1% even a decade from now.

So if inflation really is, as the IMF put it in 2013, “the dog that didn’t bark”, failing to respond to all the central bank money-printing unleashed in the wake of the 2008-9 crisis, why should investors prepare for it now, especially as demographics and technology are also conspiring to tamp down inflation across the developed world?


The answer is that some think the dog really will bark this time, partly because - unlike in the post-2008 years - governments around the world have also been rolling out massive spending packages, in a bid to limit the impact of the coronavirus pandemic.


“We will be pushing, pushing, pushing on the string and dropping our guard, then 3-5 years from now...that’s when the (inflation) dog will start barking,” said PineBridge Investments’ head of multi-asset Mike Kelly, who has been buying gold on that view.


“Gold worries about such things long in advance. It has risen through this coronavirus with that down-the-road-risk top of mind,” he added. June 22 - Reuters

 



It’s a daunting and stressful scenario.


  • How much inflation could America expect and what would it mean to household incomes and spending?
  • What industries would be further devastated by this?
  • Is there any way to reverse inflation or is there an upside to it for some?

 

If you are a reporter covering this topic – then let our experts help.


Jeff Haymond, Ph.D. is Dean, School of Business Administration and a Professor of Economics at Cedarville and is an expert in finance and trade. Dr. Haymond is available to speak with media regarding this topic – simply click on his icon to arrange an interview.

Connect with:
Jeff Haymond, Ph.D.

Jeff Haymond, Ph.D.

Dean, School of Business Administration/Associate Professor

Research interests include economics and religion, as well as monetary theory

Financial Markets (General)Federal Trade Reserve PolicyFree TradeMinimum Wage / UnemploymentGovernment Regulation

You might also like...

Check out some other posts from Cedarville University

2 min

The Anxiety of Election Season

After the results of the U.S. presidential election were announced, many Americans celebrated. But many voters instead found only stress and anxiety. After an election of rhetoric that foretold the end of democracy if the opposing candidate won, there seems to be a unique amount of post-election stress. How did election rhetoric affect this outcome, and can we expect future elections to cause this same stress? Political expert, Dr. Mark Caleb Smith, discussed the anxiety that many Americans felt even before the election and how it can be dealt with moving forward. Here are some key takeaways from his recent interview: This election cycle caused so many Americans to lose sleep that the term "electsomnia" was coined. Has the anxiety of election season always been present, or has the presence of social media paved a way for this problem? Constant access to information about the election is a probable reason for many voters' anxiety. How can Americans keep themselves informed without causing unnecessary damage to their mental health? This is not the first complicated or difficult election that the United States has faced. Now that this election season is over, how can Americans—both those who are satisfied and those who are frustrated by the results—move forward while recognizing that politics does not define them? If you are a journalist covering the election results and voters' responses, our experts are here to help with all of your questions and stories. Dr. Mark Caleb Smith is the Director of the Center for Political Studies at Cedarville University. Mark is available to speak with the media regarding election emotions and the election results. Simply click on his icon or email mweinstein@cedarville.edu to arrange an interview.

2 min

The 47th President

Former President Donald Trump was re-elected as the 47th president of the United States. He will be only the second president to serve two nonconsecutive terms—the first being Grover Cleveland in the 1800s. Much of the country shifted right this election cycle, resulting in Trump earning the electoral vote and the popular vote. This is the first time the Republican candidate has the earned the popular vote since 2004, during George W. Bush's reelection campaign. Political expert, Dr. Mark Caleb Smith focused in on how the Christian vote may have affected this outcome.In a recent Christianity Today article, Dr. Mark Caleb Smith provides some insight into how Christians voted in the most recent election. Here are some key points from the recent article: President Joe Biden is a lifelong Catholic, but since he dropped out of the presidential race, many Catholics voted for Trump rather than Vice President Kamala Harris. How did the Catholic vote for Trump shift from the last election? Trump's victory seems to indicate the importance of economics for American voters. Did Trump's economic policies sway the votes of evangelicals, rather than his stances on social issues like abortion? Although Trump had the majority of the evangelical vote, there is still a minority that rejects Trump on account of his character and tone. Did these voters lean towards the Democratic candidate, Kamala Harris, or did their votes go to third-party candidates? If you are a journalist covering the election results and transition of power, our experts are here to help with all of your questions and stories. Dr. Mark Caleb Smith is the Director of the Center for Political Studies at Cedarville University. Mark is available to speak with the media regarding election emotions, the election results, and upcoming transition of power. Simply click on his icon or email mweinstein@cedarville.edu to arrange an interview.

2 min

An Underwhelming October: The Latest Jobs Report

October brought disappointing news in the most recent U.S. jobs report. In the last jobs report before the U.S. presidential election, only 12,000 jobs were added. This is significantly lower than the expected number of 100,000, marking the slowest hiring month in years. This jobs report is reflective of the multiple hurricanes that ravaged the country this month and the ongoing Boeing strike. Dr. Jared Pincin, economic expert and associate professor at Cedarville University, has provided insight into the current economy of the U.S. and how announcements like this could affect the future.  Here are three key takeaways from Pincin's recent interview: The October jobs report may have been skewed by the two major hurricanes and the Boeing strike that have hindered Americans from working temporarily. How will the Federal Reserve view this report as they consider future rate cuts? The stock market can have strong reactions to announcements such as this. What will the market do with these numbers that are unexpected but potentially untrustworthy? This jobs report is the last key piece of economic data to come out before the presidential election on November 5. Is there any chance that voters change their minds based on this news? If you are covering the recent jobs report or the U.S. economy and need to know more, let us help with your questions and stories. Dr. Jared Pincin is an expert on economics and is available to speak to media regarding the job market, inflation, and what this means for families in the United States – simply click on his icon or email mweinstein@cedarville.edu to arrange an interview.

View all posts
Powered by