The Herald Bulletin

Afternoon Update

Columns

March 7, 2014

'Big Joe' Clark: Time to reconsider your hatred for inflation?

(Continued)

If the value of the house falls — think 2008 — then the asset is worthless as collateral. The value falling is considered deflationary. The Federal Reserve put on a full court economic press, adding over $3 trillion to its balance sheet and our economy, all in the name of keeping asset prices higher and avoiding deflation. Yes, they want job growth too, but they needed asset prices to move higher. They needed to create inflation and they did.

Inflation is fickle. The Fed acknowledges that its actions can lead to bubbles (irrational asset prices that have to decline eventually), but also note that it can’t completely control where the money goes. Is the bubble in U.S. Treasuries? Is it in farmland or in the stock market? Worse yet, is it in grocery prices? One secret characteristic of a bubble is you aren’t aware it’s a bubble when you are participating in the excitement.

Conversely, you can’t comprehend how distorted prices can become before a crash. Sudden surprises in things like weather can amplify inflation. Rising food costs are part of the economic cycle and the rising population growth.

Unfortunately we must take the good with the bad in order to see appreciation in our portfolios and house values.

Joseph “Big Joe” Clark, whose column is published Saturdays, is a certified financial planner. He can be reached at bigjoe@yourlifeafterwork.com or 640-1524.

Text Only
Columns
  • underwood mug [Duplicate] [Duplicate] Scott Underwood: Headlines can capture imagination I'd just left the newspaper office one morning and was driving north on Jackson Street, when I stopped at a red light and glanced at the rearview mirror.

    July 28, 2014 1 Photo

  • Charo Boyd: 'My Social Security' simplifies your life So many people buzz through extremely busy and complicated schedules these days. A smartphone in one hand, a computer in front of you, and a digital task list that never seems to end. In addition, to complicate things just a little more, there’s another event you need to add to your list — National Simplify Your Life week.

    July 28, 2014

  • Maureen Hayden: 9/11 Commission chair scolds Congress for national security failures Retired Congressman Lee Hamilton has warned of the perils of political ideology, calling the body where he spent 34 years “noxiously partisan.” Now, he worries the divide is downright dangerous.

    July 27, 2014

  • Vaughan, Nancy mug [Duplicate] Nancy Vaughan: Fireworks and fireflies mean summer in full swing Hasn't July been a fabulous month? It began with multiple fireworks venues and parades and ends with fairs and football in full swing. We have been blessed with mild weather and if you haven't had to travel much outside of the county, roadwork has been minimal.

    July 26, 2014 1 Photo

  • Ken de la Bastide: City unions go without contracts for many years How Anderson deals with unions has changed dramatically over the years. In the past it would have been unheard of for union members to continue to work without a contract or an agreed upon deadline. But members of three unions that represent Anderson city employees have been working without a new contract agreement for up to seven years.

    July 26, 2014

  • Jim Bailey: Traveling by passenger train was a page from the past My wife doesn’t remember riding on a full-fledged passenger train as a baby. Our children have never ridden. It’s an experience rapidly going the way of the horse and buggy and the stagecoach throughout a nation now obsessed with jumbo jets and sport-utility vehicles.

    July 26, 2014

  • Howard Hewitt: When it comes to wines, small can be very good Repeating the familiar is an easy way to go through life as is taking the safe road. We all do that but find unexpected rewards when taking the path less traveled. That little bit of philosophy applies to visiting wine country.

    July 26, 2014

  • Maleah Stringer: Hats off to the staff at Animal Protection League I often talk about the wonderful volunteers and community support we have at the Animal Protection League. And that volunteers are every non-profits "life blood" this is true for the Animal Protection League as well.

    July 26, 2014

  • Clark, Big Joe mug 'Big Joe' Clark: Beat the market or meet your goals? True or not, my experience tells me that goals – especially when written down – undoubtedly serve as catalysts for success. However, danger arises when a goal does not properly focus on the long term result you expect.

    July 25, 2014 1 Photo

  • Verna Davis: Seek peace by turning from evil and doing good There's something we all want: peace. World peace. Family peace. Personal peace. We yearn for peace, a feeling of freedom from commotion and antagonism, of harmony in our relationships, of lack of strife or dissension. What would we do to have peace in our lives?

    July 25, 2014

Featured Ads
More Resources from The Herald Bulletin
AP Video
US Ready to Slap New Sanctions on Russia Kerry: Not Worried About Israeli Criticism Boater Rescued From Edge of Kentucky Dam Girl Struck by Plane on Florida Beach Dies Rodents Rampant in Gardens Around Louvre House to Vote on Slimmed-down Bill for Border Looming Demand Could Undercut Flight Safety Raw: 2 Shells Hit Fuel Tank at Gaza Power Plant Raw: Massive Explosions From Airstrikes in Gaza Giant Ketchup Bottle Water Tower Up for Sale Easier Nuclear Construction Promises Fall Short Kerry: Humanitarian Cease-fire Efforts Continue Raw: Corruption Trial Begins for Former Va Gov. The Carbon Trap: US Exports Global Warming Traditional African Dishes Teach Healthy Eating
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Helium debate
Helium
Front page
Poll

Now that Andrew Luck is getting ready to start the third year of his NFL career, did the Colts make the right decision to release Peyton Manning and turn the offense over to Luck?

Yes, the future is bright.
No, the Colts would have won another Super Bowl by now if they had kept Manning.
Don't know; don't care
     View Results