How to Have Peace of Mind During High Inflation
2022 is the year of inflation. Granted, it started in 2021 because of the massive disruption that Covid caused in the world. But inflation is on everyone’s radar now.
After all, it’s difficult to have peace of mind during a period of high inflation. We haven’t seen this in the developed world for decades. And it’s highly uncomfortable if you’re facing higher prices for everything every single month.
You probably hear about the current economic problems every day, which makes it even worse. It’s all over the media.
- Inflation is still getting higher
- Stocks are down
- People are starting to get fired
- Companies are barely hiring
This is looking like stagflation: There’s high inflation and low economic growth.
Last week, a friend told me he’s been seeing investment ads lately. The ads claim they have investment strategies to generate amazing returns during inflation. Meanwhile, the most famous hedge funds (like Tiger Global) — which are armed with some of the brightest minds in finance — are down 60%!
If these “experts” are really making so much money from investing, they wouldn’t waste their time putting up ads. There are always people who try to profit from fear and greed. Don’t be seduced by them.
Look at the big picture
Remember the “Great Resignation” last year? People were handing in their resignations by the thousands and getting better-paying jobs. Well, now the media is saying the party’s over and economists claim inflation will remain high for a while.
When we’re faced with economic problems (or any problem), there are two ways to view things:
- Up-close perspective: Looking at inflation, interest rates, debt, consumer spending, joblessness, and so forth.
- Broad perspective: Looking at long-term trends and historical patterns.
You can get tunnel vision during periods of high stress. So I always suggest taking a step back for a broader view. Because what happened in the past can teach us…