Is hyperinflation really coming?

(and what you can do to prepare for it)

What are the factors causing inflation now?

Governments pumped huge sums of money into their financial systems during the pandemic in the form of stimulus checks (i.e. GST Vouchers in SG) directly to households and businesses, lowering interest rates and other capital injection policies.
Many companies experienced supply chain issues, scaled back or shut down during the pandemic, resulting in a decrease in supply, which will take some time for products and services to ramp back up again as the economy reopens

With so much money flowing into the system, people are feeling richer and are ready to spend...

but with decreasing supplies, this has already caused us to see higher inflation rates in the past year, with countries like Venezuela and Turkey already experiencing the turmoil of hyperinflation

Will inflation rates escalate towards hyperinflation?

The Philadelphia Federal Reserve reported price indexes have been increasing at its highest rate since the 1980s, and many are speculating that hyperinflation might be coming.

However, since the U.S. Dollar is a global currency, even with the huge injection, it is not only kept within their local economy but trickles down to the global economy which can cushion some of the negative consequences (unlike in Zimbabwe or Venezuela).

But does it affect us in Singapore?

Singapore's annual inflation rate rose to 4.0% in December 2021, pointing to the highest figure since February 2013.

As our economy runs heavily on imports and exports, we aren't immune to changing prices. Especially in commodities like crude oil, zinc, copper and tin which prices have increased over 50% on average.

As an average consumer, we will see these increases most prominently in the prices of food, electricity, rent, petrol and public transport.

Nobody can be certain of what's to come, but it's possible to protect your wealth from becoming obsolete in the case of high inflation rates.

There are still some ways you might be able to safeguard your wealth

Inflation is not coming. It’s already here. But you don't have to get apocalypse ready: there are still ways you can use to protect yourself from inflation.

21 Sep

BudgetingPersonal FinanceSelf-Care

TrueNorth Financial

When to know it’s time to quit your job

Have you been thinking about calling it quits at your job? There’s a lot of content out there saying “this might be your sign to resign” BUT that could be dangero

20 Sep

FinancePersonal Finance

TrueNorth Financial

Why the 50-30-20 budgeting rule might not work for you

What is the 50-30-20 budgeting rule? Chances are, if you’re new to budgeting, this would be one of the first search results you get when searching for easy budgeting methods.

20 Sep

CPFInvesting

TrueNorth Financial

Consider this before investing with your CPF monies

CPF investing is great for retirement planning… but you’ll need to be able to understand the risks and costs involved when doing so. If you want to get started but aren

Tags: Finance Hyperinflation Inflation Investing