Timely Economic Perspectives
Last week the Wall Street Journal ran with a headline about “Quadruple Threats”1 to the economy. Not to be outdone, on the same day, Marketwatch.com posted the following image2 highlighting no less than FIVE current threats to the economy:
While I can see how these things, particularly when they are packaged this way, could be concerning to investors, it’s important to note that they were curated by a media outlet with this specific intent in mind; i.e. to evoke fear in their readers! So, in response to this, I have broken down each of the “threats” below to help us maintain proper perspective.
- Student Loans. Everyone that got a loan knew they would have to pay it back. Students have been paying on education debt for decades. Paying back student loans is nothing new.
- Government Shutdown. The threat of a shutdown happens every few years. To be exact, the government has shut down 21 times in the past 50 years.3 While frustrating to watch, this is nothing new in our history.
- Inflation. This is old news. In fact, inflation has improved quite a bit this year. Either way, the inflation concern is certainly nothing new.
- Union Strikes. Strikes will happen regularly in a capitalistic economy. They are a negotiation tactic. Dealing with strikes is nothing new to our economy.
- Oil. Oil has always been volatile. Sometimes it acts as tailwinds and sometimes headwinds to the economy. Nothing new here. As a point of interest, the average price of gas was $3.88/gallon in Sept 2023, but that is far from the highest. In June 2008, it was $5.71/gallon (in today’s dollars) – almost 50% higher.4
As investors, we are bombarded with the concerns du jour. It’s important that we calibrate our perspectives to look at the big picture. And that’s what I am here for. If you have concerns, let’s talk to ensure all relevant information is being considered.
- Wall Street Journal, Sept 25, 2023.
- Source: MarketWatch.com, 09/25/2023
- Axios. Retrieved on 09/28/2023 at https://www.axios.com/2023/09/24/federal-government-shutdown-history-list?utm_source=substack&utm_medium=email
- Energy Information Administration
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