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NW Indiana | What if the fed makes the same mistakes of the late 60's going into the 70's. If you look at the following charts inflation started heating up in the late 60s. The fed raised rates leading to a recession. A couple years later inflation took off again into 1974 with increases in interest rates leading to another recession. Once again inflation heated back up in the late 70's leading to Volker in the early 80's putting a stop to the fire with major interest rate rises leading to a recession.
So I've been saying assets have to come down in value (land, homes etc) but as long as interest is a real negative number aren't we likely to just repeat something similar to the above? Are we just at the beginning of a decade full of recessions, inflation and interest rates no one sees coming? 4 recessions in 12 years during the mentioned timeframe.
To make it interesting take a look at corn prices during the 70's, once the price ran up accord it became very volatile somewhat following very similar to inflation and interest rates. So is this an indication if we have a recession coming based on the fed attempting to slow things down will grain prices dip lower then many think even during an inflationary period? Corn got cut in half after the 1974 run up from $4 down to below $2.
Corn Prices - 59 Year Historical Chart
Edited by IN555 4/19/2022 19:12
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What if the fed doesn't get inflation under control
