M Financial on Money: Sorting through the noise
Sorting through the noise
Recession, inflation and the economic impact of the Ukraine Crisis
It’s not easy sorting through the economic noise these days. In recent weeks, the word recession has started creeping into business news and financial market coverage. Is that cause for alarm or just another attention-grabbing headline? There’s no simple answer.
A recession is defined as 2 consecutive quarters of negative economic growth as measured by gross domestic product (GDP). But GDP is a lagging indicator, so we may not know until sometime in 2023 if we lived through a recession in 2022.
When inflation is running hot, you can feel its overreach in almost every corner of the economy. People see it when they buy gas and at the grocery store, but its influence also touches mortgage rates, credit card debt, and overall consumer confidence.
Geopolitical events have added a layer of uncertainty and are one of the main drivers of volatility. Energy prices continue to move higher as events unfold in Eastern Europe.
Add it all up, and you could be thinking, “I just want to sit this one out.” Staying positive these days is a lot easier said than done. But that’s exactly the time when you should remind yourself about how your risk tolerance works within your long-term financial plan.
Make an appointment to discuss your unique situation today, and ask about our Second Opinion service.
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