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SUPPLY SIDE INFLATION AND
YOUR INVESTMENTS
By: www.ProfitableInvestingTips.com
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
The USA is experiencing its highest inflation in four
decades. Both prices and wages are up.Wages
are up because there are more available jobs
than people to fill them. Prices are up for three
reasons.Two presidents, the US Congress, and
the Federal Reserve flooded the economy with
money to fight the pandemic-driven recession
and overshot.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
Russia is being cut off from the world economic
system due to its war on Ukraine. And China is
using a zero tolerance lockdown strategy to
fight the current wave of theCovid omicron
variant shutting down a critical part of the global
supply chain. Both Russia and China are partially
responsible for the supply side part. Here we
look at supply side inflation and your
investments.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
Fed Efforts to Calm Inflation
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
The US Federal Reserve has raised interest rates by
0.50% in May and will be repeating this monthly
for several months according to Fed Chair
Powell.When he stated that 0.75% raises were
off the table the markets soared toward the
close as the Dow, S&P 500 and Nasdaq all had
their best day of the year.This was followed the
next morning by the worst day of the year as all
indices fell by more than their previous day’s
rise.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
The Fed’s efforts could easily cause a recession
which happens more often than not with rate
increases.Thus, the Fed efforts to calm inflation
could hurt the economy and the markets and
should be taken into consideration when
investing.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
Supply Side Issues Will Not Be Helped By Fed
Actions
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
China is experiencing the downside of karma.They
started the Covid pandemic and now are using a
draconian zero tolerance policy to control
outbreaks.They are using an ineffective vaccine and
have low vaccination rates in the elderly. All of
Shanghai (25 million people) is shut down adding to
supply chain problems coming out of Asia.These
supply side issues are driving up prices such as when
there are not enough computer chips to make cars,
car production suffers, car prices, new and old, go
up.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
Russia’s war in Ukraine has effectively cut off 30%
of wheat exports, 50% of sunflower seed oil
exports, 20% of corn exports, and a fifth of
fertilizer exports like potash and ammonia. As
nations across the globe fear for food shortages,
shortages of raw materials, and more we are
seeing protectionism replace much of the
previously interlocked global supply chain. When
commodities are available at all, prices are
higher and will likely go higher yet.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
Investing In a World With Protectionism and
Supply Side Inflation
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
When the stock market crashed in 1929 the US
made things worse by passing a tariff on imports
from Europe. Europe countered with their own
tariffs and the trade war helped drive the world
into decade-long depression that included a
three-year-long slide of the stock market.Today
the issues are supply chain disruption, war in
Ukraine, Covid lockdowns, and raging inflation.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
The slide in the stock market will likely continue so
long as these issues have not been rectified.The
Fed’s actions will help reduce inflation but do
nothing to help supply issues.Thus, you will likely
see many of the stocks in your portfolio fall and
continue to fall for months or even years as in 1929
to 1932.The best investments during this time will
be companies that do not rely on foreign imports or
foreign customers such as McDonalds, utilities, and
tech companies that create and sell software like
Microsoft.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
All of these will be affected when people start
cutting expenses but will not be hurt by supply
chain issues, protectionism, or actions of
economic warfare such as with Russia. Another
alternative will be US and European defense
stocks so long as the war in Ukraine lasts and
even longer as a new cold war ensues and
nations have to replenish their arsenals that are
being depleted by the war.
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
https://profitableinvestingtips.com/profitab
le-investing-tips/supply-side-inflation-and-
For more insights and useful information about
investments and investing, visit
www.ProfitableInvestingTips.com.

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Supply Side Inflation and Your Investments