There has been a lot of talk about the possibility of rising inflation in the US. Warren Buffet believes that inflation is a real threat. We have also blogged about it quite a bit. See our list of previous posts below for further reading.
So far, inflation has remained stable. Compared to the rest of the world the US’s inflation rate actually seems quite low (see infographic below). However, we do expect to see higher inflation ahead. Here’s why:
- The Fed is growing the money supply and that can at some future point create ‘too much money chasing too few goods and services’, the exact prescription for inflation.
- The governments massive borrowing to finance huge budget deficits is compounding the problem.
Click to Enlarge
Infographic by BillShrink
For further reading:
- Warren Buffett Says Inflation is a Real Threat [Adam Zuercher]
- The US Budget is on an Unsustainable Path [Adam Zuercher]
- The Truth About the Dollar [Adam Zuercher]
- Is inflation accelerating? [Tony Hixon]
- Why is higher inflation expected? [Tony Hixon]
- Why hasn’t inflation occurred yet? [Tony Hixon]
- When will inflation return? [Tony Hixon]
- How high will inflation go? [Tony Hixon]