Publications

- November 2009: Vol. 21 No. 10

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Inflation Fears: Clear and Present Danger or Much Ado About Nothing?

by Larry Gray

The easy money and cheap dollars policy by the Federal Reserve has rescued the U.S. economy … at least for now. While the recession may be over, we are not out of the woods yet. There is growing concern that the expansionary monetary policy will produce rapidly rising prices, possibly even double-digit inflation rivaling that experienced during the 1970s, according to some prognosticators. And while the prospect of inflation may keep some investors up at night, a more dreaded economic scenario is the fear that in its effort to stave off inflation, the Fed raises interest rates too soon, choking off the economic recovery and producing another wave of job losses, foreclosures, business bankruptcies and asset deflation. However the economy plays out over the next few years, the road to recovery promises to be challenging, for policymakers and investors alike.

All over the world, countries are printing money. Historically, this has always led to higher commodity prices. This ti

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