Read the assigned Forbes article and summarize in at least 100 words.
This article by Bill Conerly is about the inflation hedges that did and didn’t work from 2020 to 2022. From the jump Conerly talks about the inflation price jump from 2020 to 2022, we see it go from 1.4% all the way to 8.2%. Afterwards he makes mention of things that I have either gone up or down in value of the past couple years, gold being one of them that he had mentioned (it went down in value). Lastly Conerly gives his advice for investors and says that “The best lesson is that investors should stick with basic truths, such as the long-run growth of stock prices and the risk reduction of diversification. Too much focus on hedging a short-run risk can blind one to those basic truths that should dominate investment decisions”.
Reflect on what we learned in the course, find at least one chapter in the textbook where we discuss the related topic, and explain how the chapter(s) is related to the reported event in the article. Do this in at least 100 words.
While reading through this article it reminded me of Chapter 4 Inflation: Recession Triggers and Profit Squeezes. The main talk of this article was the impact inflation has had on economies around the world. Covid-19 is the biggest reason for all of this change too, it sparked the last huge global recession back in 2020. The part I think that meshes most with the article is when the chapter talks about “Business Decisions and Profit Squeezes”. The stock prices have changed drastically since the 2020 recession, and other materials mentioned in the article like gold are seen at a lower value nowadays. We are still coming back from the 2020 recession and I bet it’ll take at least a couple more years to fizzle out before we get back to a ‘normal’ marketable economy again.