Pub 1 2021 Issue 4

40 | The Show-Me Banker Magazine ONE LAST THING ... Did you know that you can enjoy your association news anytime, anywhere? The new online article build outs allow you to: • Stay up to date with the latest association news • Share your favorite articles to social channels • Email articles to a friends or collegues There is still a flipping book for those of you that prefer swiping and a downloadable PDF. Scan the QR code or visit: the-show-me-banker.thenewslinkgroup.org Check it out! Today, we have increased prices (inflation). But these increased prices are due to “re-starting” economies, not a huge demand growth economy, which is a much different scenario. What if the Federal Reserve chairman is right and this is a temporary situation? The debate can meander to the concept of stagflation. Stagflation is defined as persistently high inflation combined with high unemployment and sluggish demand in the economy. Based on the experience in the 1970s, this is economically painful. Today, we are experiencing inflation and unemployment (arguable higher when measured by U-6 unemployment numbers), coupled with diminished workforce participation. That counts as two of three Continued on page 39 The debate can meander to the concept of stagflation. Stagflation is defined as persistently high inflation combined with high unemployment and sluggish demand in the economy. Based on the experience in the 1970s, this is economically painful. markers for stagflation (inflation, a sluggish economy) compared to pre-pandemic numbers. Could increasing interest rates result in stagflation or a hybrid-type of stagflation? There are strong arguments on both sides. Because there is no clear-cut path and the Federal Reserve has adopted a new policy approach, it behooves banks and businesses to position themselves to perform their best in either environment. ■ Tim Ohlde is the CEO of Country Banker Systems. Country Banker is a loan analysis software program designed by bankers for bankers to use intuitively and efficiently. Ohlde is also CEO of Elk State Bank. Both companies are based in Clyde, Kansas.