Annex Wealth Management President and CEO Dave Spano predicts that inflation will “stick with us” for several months.
Spano discussed the market with John Mercure during WTMJ 2022, insisting that market volatility will continue until we at least get clarification on the Ukraine-Russia situation, saying it’s causing “consternation.”
But that’s not the only concern.
Spano pointed to the supply chain disruption, great demands towards goods and a ton of fiscal and monetary surplus going into the market as reasons for such high inflation. He said, for example, new vehicles weren’t able to be transported due to the lack of semiconductors, so people bought used cars, spiking the cost of used vehicles.
“The Federal Reserve has two jobs; one of them is to control inflation and the other one is to keep the folks in the United States employed,” Spano said. “Well, unemployment came down around 15% at it’s peak during the pandemic, down to about 3.5%; yet the Federal Reserve kept their foot on the accelerator. And we said, for a long time, ‘we don’t think it’s transitory;’ we think there are parts of this that are going to be sticky.”
“It wasn’t just President Biden,” Spano added. “It was the Federal Reserve who kept saying ‘transitory.’ Now that they have realized that it isn’t going to pass through immediately, they have dropped the term. In fact, the chairman of the Federal Reserve said, ‘we will drop that term, we won’t call it ‘transitory’ anymore.”