DAVE & DUJANOVIC

Economy is healthy except for inflation, which will come down, says finance expert

Mar 17, 2022, 6:32 PM
wholesale inflation utah interest rates...
FILE: KSL TV

SALT LAKE CITY — Inflation is hurting everyone but will drop, and the economy is healthy overall for those seeking good jobs in a tight labor market, says a financial expert.

The good news is the price of a barrel of crude oil has fallen about 20% below its record high of $130.5 reached on March 7. But on Wednesday, in an anticipated move, the Federal Reserve bumped up interest rates for the first time since 2018 in order to blunt rising inflation rates not seen as high since the early 1980s. The Fed sees six more rate hikes this year and three more in 2023.

Caleb Silver is a US journalist and the editor-in-chief of Investopedia. He joined KSL NewsRadio’s Dave Noriega and Debbie Dujanovic to discuss the inflation, interest rates and what lies ahead for consumers.

Slow the economy but not too much

“So, what happens if we do end up slowing down the economy too much too quickly?” Dave asked.

“Well, the risk is recession. And that’s the one everybody’s worried about, especially with rising oil prices. Oil prices have come down from their highs from last week, but they’re super-unpredictable right now,” Silver said.

He said the Fed wants to hit the sweet spot: brake the overheated economy without crimping borrowing costs for consumers and businesses seeking new workers.

“Consumers drive 70% of GDP, but it’s also businesses. They’re trying to hire as much as they can in a very tight labor market. But if borrowing costs go up [and] expansion costs go up, that means they may slow down on the hiring,” Silver said.

The sting of inflation should lessen

“How will this hit me in the pocketbook, Caleb?” Debbie asked.

Silver said the borrowing costs will go up for credit cards, and interest rates will rise for car loans and refinancing on other loans and “anything that’s not fixed like a mortgage.”

“How quickly could we see some of this inflation relief? And how much is this going to come down?” Dave asked.

“The Fed says they see inflation at around 4.5%  by the end of 2022. That’s significantly down from the 7.9% we’re feeling right now,” said Silver. “But that’s still pretty high compared to where we’ve been over the last 20 or so years.”

He added the drop in inflation and energy prices are tied to Russia’s war in Ukraine.

Good-paying jobs are out there

“Is there any advantage you can take in this economy?” Dave asked.

“The economy is pretty healthy except for inflation, which is hurting everybody right now,” Silver said.

He pointed out that the labor market is good right now: Wages stalled in the past two month but have been rising over the last year and a half. Because of the shortage of workers, good jobs are out there.

“It’s hard to find people to work for you. But if you have a good idea, now’s a good time to launch it,” Silver said.

 

Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.  

Read more: 

Today’s Top Stories

Dave & Dujanovic

Utah Democrats Gene Davis...
Simone Seikaly

Attorney for Sen. Gene Davis says Davis won’t resign from the Utah Senate

The Salt Lake County Democratic Party asked for Davis to resign immediately because of allegations of sexual harassment made against him.
3 days ago
ovarian cancer...
Simone Seikaly

A new chance for a fighting chance against ovarian cancer

What may be most alarming about ovarian cancer is that the symptoms are there, but they are quiet and can be mistaken for something else.
4 days ago
...
Curt Gresseth

Former U.S. Attorney for Utah talks about what FBI can take off your cellphone

A legal expert joined Dave and Dujanovic to discuss how the FBI can obtain evidence of a crime from a cellphone.
8 days ago
centerville arson fire...
Curt Gresseth

What’s behind random acts of violence in Utah?

What's behind a recent spate of random violence in Uta?. A sleeping couple at home in West Valley City is stabbed by an intruder. A stranger enters a home with three elderly people in Centerville and burns it down. Greg Skordas, KSL legal analyst breaks down what he thinks is motivating young people to commit random acts of violence.
9 days ago
Government contractors erect a section of Pentagon-funded border wall along the Colorado River. (AP...
Curt Gresseth

Yuma mayor talks about migrants illegally crossing into city: US has the laws to fix problem

An Arizona mayor talks with Dave & Dujanovic about migrants coming into the country illegally. He says the U.S. has the laws to fix the problems.
10 days ago
BYU study COVID money...
Elizabeth Weiler

Utah’s young adults being launched into the world of financial responsibility

Because young adults are rarely in personal high-income situations, they are categorized as low-income, making them at higher risk for credit card debt. 
10 days ago

Sponsored Articles

Young woman receiving laser treatment...
Form Derm Spa

How facial plastic surgery and skincare are joining forces

Facial plastic surgery is not only about looking good but about feeling good too. The medical team at Form Spa are trained to help you reach your aesthetic outcomes through surgery and through skincare and dermatology, too.
large group of friends tohether in a park having fun...
BYU MBA at the Marriott School of Business

What differentiates BYU’s MBA program from other MBA programs

Commitment to service is at the heart of BYU’s MBA program, which makes it stand out among other MBA programs across the country.
a worker with a drill in an orange helmet installs a door in the house...
Price's Guaranteed Doors

Home improvement tip: Increase the value of your home by weatherproofing doors

Make sure your home is comfortable before the winter! Seasonal maintenance keeps your home up to date. Read our tips on weatherproofing doors.
Curb Appeal...
Price's Guaranteed Doors

How to have the best of both worlds for your house | Home security and curb appeal

Protect your home and improve its curb appeal with the latest security solutions like beautiful garage doors and increased security systems.
A paper reading IRS, internal revenue service is pictured...
Jordan Wilcox

The best strategies for dealing with IRS tax harassment | You have options!

Learn how to deal with IRS tax harassment. This guide will teach you how to stop IRS phone calls and letters, and how to handle an IRS audit.
spend a day at Bear Lake...
Bear Lake Convention and Visitors Bureau

You’ll love spending the day at Bear Lake | How to spend a day at Bear Lake

Bear Lake is a place that needs to be experienced. Spend a day at Bear Lake.
Economy is healthy except for inflation, which will come down, says finance expert