“Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five dollars when you had hair.” That’s according to Sam Ewing, a former baseball player for the Chicago White Sox and the Toronto Blue Jays. When it comes to inflation, it seems everyone’s an economist now (even though economics is often referred to as “the dismal science”). Rising prices and supply chain problems are spawning thoughts of impending financial gloom and doom.
Data released last week by the U.S. Bureau of Labor Statistics indicate that prices rose 0.6 percent during the past month. There are three inflationary factors at work simultaneously as a result of the pandemic: lots of people who have put aside lots of money; pent-up demand for goods and services; and shortages in the supplies of goods and services. But are these situations temporary?