The cycle of higher unemployment and prices must be broken.
I am not an economist, but having been around the block more than a few times over the past decades, it sure looks like financial déja vu!
My career started in the mid-1970s. At that time, the economic arena was swirling from extraordinary events that, together, created the perfect storm for hyperinflation. The aftermath of the US political crisis Watergate, staggering gas lines and shortages caused by the rolling Middle East oil embargos, and questionable Federal Reserve tactics led us to double-digit inflation. At that time, I was pricing administrator for a division of a global electronic connector manufacturer. Among my responsibilities was keeping the multi-thousand-part price book up to date. This task historically was done once every one or two years. In the environment we were in, however, I was updating prices two to three times each year!
It’s with this perspective I find myself trying to read the proverbial economic tea leaves of where we are headed in 2021 and beyond.
The past couple years, like in the mid-70s, have been filled with extraordinary events. Washington has been in gridlock; tariffs are finally resulting in shifts in where product is produced and shipped; a pandemic has displaced millions of workers and sent more home to work. Manufacturing facilities are reducing onsite staff, resulting in lower output and product shortages. Governments are responding with economic stimuli in the form of direct cash to citizens, enhanced unemployment benefits for those out of work, and low-cost loans to business and industry.
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