When our leaders talk about inflation, it’s important to focus on future probabilities rather than past numbers. Past figures might make us comfortable, but they don’t help us with next month’s expenses. Especially in a rising inflation environment when it appears nothing is being done. And our leaders are not being forthright while spending, spending, and more spending occurs.
To plan your finances well, you need to consider what inflation might look like.
To plan your finances well, you need to consider what inflation might look like.
Newton’s First Law of Motion states that an object will stay at rest or continue moving in a straight line at the same speed unless something else acts on it.
If nothing changes, inflation or deflation will keep moving in the same direction—up, down, or sideways. Newton’s First Law is about inertia, which means things tend to stay the way they are unless something forces them to change. Inflation is influenced by many factors, like economic issues (debt, interest rates, unemployment) and political decisions (student debt forgiveness, energy policies, etc.).
When you cut through all of the lies and changed positions, if prices are going up, they’ll keep going up until something changes. The same goes for things that are going down. And history shows that if we forget what happened before, we’re likely to repeat it.
Take the 1970s under Jimmy Carter, for example. Inflation was high due in part to overspending during the Vietnam War. It seems like we’re heading in a similar direction again.
Remember, this isn’t complicated economics. Printing too much money leads to problems like those in the Weimar Republic, where people needed wheelbarrows of cash to buy a loaf of bread. Even back in the days when economies were based on gold, adding other metals to it caused inflation. Just ask Copernicus, who was ignored when he pointed this out.
This isn’t just a random thought—if we expect the current administration to solve issues like wars, border control, and rising energy costs, we might be disappointed. After four years, there’s been no real solution, which brings us back to Newton’s First Law.
Take a look at current inflation numbers. They’ve gotten worse since Biden took office. Think about the future for your kids and grandkids, and whether we need to change course before it’s too late.