I thought I would throw in my two cents on the topic that has recently been on the front page of every newspaper and leading every newscast – Inflation.

The months-long pace of inflation continues to accelerate, with the June Consumer Price Index reflecting an increase of 9.1% from the previous June. In addition, the Producer Price Index showed an 11.3% increase over the same period – just slightly less than the record of 11.6% seen in March.

As I pen this piece, I am notified that on this day (July 15) in 1979, President Jimmy Carter delivered his “malaise speech”. At the time the speech was given, the US was burdened economically with high energy prices and stagflation. And this 1970s-style stagflation is now on the minds of central bankers. The Bank for International Settlements wrote in its latest report that “We may be reaching a tipping point, beyond which an inflationary psychology spreads and becomes entrenched.”

I’m no economist, but it seems to me that the highest inflation we’ve seen in 40 years was not – or shouldn’t have been – an unforeseen circumstance (regardless of our Treasury Secretary’s surprise that rampant inflation did not subside.) You can’t have foreign governments and states throughout this nation forcing large-scale shutdowns of production for fear of COVID-19 and then have the Federal government dump trillions of dollars into the economy without inflation resulting.

An additional factor to inflation, and, in fact, a force multiplier, are energy costs. The Russian invasion of Ukraine was a contributor to this (especially in Europe) but much of this rise at the gas pump is attributable to government action. On President Biden’s first day in office, he cancelled the Keystone Pipeline and put a moratorium on leases. (Not long after, he was pleading with the OPEC nations to increase their oil production.) When leases were again opened up this last April, the acreage available for leasing was down 80% and the royalty fees paid by oil companies increased from 12.5% to 18.75%.

What does the immediate future hold? Most likely, brownouts due to overtaxed electrical grids, more inflation and a recession, brought on by supply chain problems, mandatory minimum wage increases, labor workforce participation contractions, fuel costs and the Federal Reserve increasing interest rates by .75% or more.

The chickens have come home to roost.