The stock market has seen dramatic downturns in the last few weeks. Clarion financial planner, Jim Tausz says there are a lot of factors involved — but one stands out.
“We are seeing a lot of inflation. Inflation is the biggest thing happening right now. And that is caused by food prices and gas prices, which by the way, aren’t even in the basic information that you get from the government saying, you know, what inflation factor is, “Tausz says. He says the inflation figure is much higher with those things included.
“We probably have inflation in the neighborhood of anywhere between 13 and 15 percent.. Stocks don’t like that. We’re gonna see a continued downtrend, because we’re seeing interest rates also go up,” he explains.
Tausz says increasing gas production would be a big help. “The two big things that would really change things and turn things around really fast — one of them without a doubt is you got to open up production, gas and oil production,” He says. “you have to do it because we’ve got to take care of also the Western world, and I’m talking about NATO.”
He says we’ve got to, in his opinion, get inflation under control. The Federal Reserve has raised interest rates to try and do that — and he says interest rates will come back down eventually. But it could take some time.
“And I think we’re going to see this for some time to come,” Tausz says. He says one strategy would have been to get out of the stock market and put funds in insured money markets in your brokerage account. Then get back in when things turn around — the old buy low, sell high strategy.
(By Pat Powers, KQWC, Webster City)